Madras High Court
Sri.Vasavi Finance Corporation vs M.R.Patel on 5 September, 2011
Author: M.M.Sundresh
Bench: M.M.Sundresh
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 05/09/2011 CORAM THE HON'BLE MR.JUSTICE M.M.SUNDRESH S.A.No. 787 of 1997 Sri.Vasavi Finance Corporation, rep. by its Managing Partner, Geetha Kasturi Rengan, 64, Gandhiji Road, Thanjavur. .. Appellant/Plaintiff Vs. 1.M.R.Patel 2.Gouthamchand 3.Parthasarathy .. Respondents/Defendants Prayer Second Appeal under Section 100 of Civil Procedure Code, against the judgment and decree dated 28.06.1994, passed by the Court of District Judge, Thanjavur in A.S.No.161 of 1993, confirming the judgment and decree dated 27.07.1993 passed by the Court of District Munsif, Thanjavur in O.S.No.673 of 1981. !For Appellant ... Mr.V.K.Vijayaraghavan ^For 1st Respondent ... Given up For 2nd Respondent ... Mr.A.Thiagarajan For 3rd Respondent ... Mr.Anand Chandrasekar for M/s.Sarvabhauman Associates ***** :JUDGMENT
The unsuccessful plaintiff, who lost before the Courts below is the appellant. The appellant herein filed the suit for recovery of money on promissory note for a sum of Rs.8,052/- with subsequent interest at 12% p.a. The Courts below dismissed the suit filed by the appellant in view of the discrepancies in the evidence of P.Ws.1 and 2 regarding the receipt of the cheque said to have been issued by the second defendant for a sum of Rs.250/- and the entries made as well as on the ground of limitation. Challenging the judgment and decree of the Courts below and formulating the following substantial questions of law, the present Second Appeal has been filed.
"(1) Whether the suit claim for recovery of money is not barred by time in view of the payment made on 20.02.1979 by the second defendant as per the entry made in the pass book maintained during the ordinary course of business and as the suit having been filed within three years from the date of last payment? (2) Whether the second defendant is not debtor as per the Debt Relief Act when Exs.B.1 to B.4 do not show that he was assessed to Income Tax for the period contemplated in the Act?"
2. A promissory note was executed by the first defendant on 24.01.1976 under Ex.A.1. The said document has also been signed by the defendants 2 and 3. It is the case of the appellant that the said promissory note executed for a sum of Rs.10,000/- has not been discharged. Therefore, a suit has been filed in O.S.No.673 of 1981 on the file of the District Munsif Court, Thanjavur, seeking recovery of the remaining amount.
3. In the plaint, the appellant has stated that the suit could not be filed earlier since he bonafidely thought that the defendants are entitled to the benefits of moratorium under the Debt Reliefs Acts. It has been further stated that the defendants have made payment towards the suit debt in the following dates:
1. Rs.600/- on 31.01.1975;
2. Rs.650/- on 16.02.1976;
3. Rs.998/- on 31.05.1976;
4. Rs.500/- on 31.07.1976;
5. Rs.100/- on 15.03.1977;
6. Rs.250/- on 20.02.1979.
4. A reply statement has been filed by the appellant stating that in view of the payments made by the defendants acknowledging the debt with the last payment on 20.02.1979, the question of limitation does not arise.
5. The defendant No.1 was set exparte. The second defendant has filed a written statement stating that the suit is barred by limitation and Ex.A.1 has been signed by himself by way of a security. It has been further stated that he is a man of means. In paragraph No.5 of the written statement, it has been stated that the payments said to have been made in the plaint would not save limitation period.
6. The third defendant filed a written statement raising the question of limitation. It has been further stated that the said defendant is a contractor and he has never been a debtor.
7. The Courts below dismissed the suit filed by the plaintiff on the ground that there are certain discrepancies in the evidence of P.Ws.1 and 2 in respect of number of entries made towards the partial payment of the debt of the defendants. It has been further held that the discrepancies in the evidence of P.Ws.1 and 2 regarding the receipt of the cheque said to have been executed by the second defendant falsify the case of the plaintiff. The suit was also dismissed based upon the ground that it is barred by limitation.
8. It is to be seen that the plaintiff filed Exs.A.1 to A.4, apart from filing the passbook. Exs.A.2 to A.4 and the subsequent documents filed by the appellant are the records maintained by it showing the payment made by the defendants on various dates including the last of the payment made on 20.02.1979.
9. Insofar as the limitation is concerned, the learned counsel for the appellant submitted that the suit was filed on 21.01.1981, even though the last date for filing the suit was 21.11.1982. If the acknowledgement said to have been made by the second defendant is taken into consideration, then the suit is well within time. Merely, because a ground has been raised in the plaint, giving reason for the delay, in view of the subsequent averments, the Courts below ought not to have dismissed the suit on the question of limitation. Insofar as the payments said to have been made by the second defendant is concerned, the learned counsel for the appellant submitted that the relevant records were produced and marked by the appellant and therefore, the plaintiff's evidence would show that the second defendant has paid a sum of Rs.250/- on 20.02.1979. The second defendant has not specifically denied the factum of payment in the original written statement filed.
10. The learned counsel further submitted that it is admitted by the second defendant that he is having account in the Permanent Bank, Thanjavur. A notice was also issued during the pendency of the suit under Order 12 Rule 8 for production of the documents. For the reasons best known to the second defendant, he has not produced those documents. Since the said documents have not been filed, an adverse inference has to be drawn against the second defendant. When the second defendant has contended that he has signed the document Ex.A.1 as a guarantor or by way of a security, it is for him to explain the circumstances under which it has been done. In support of his contention that the failure of the second defendant in producing the document sought for would lead to adverse possession, he relied on the decision of the Hon'ble Apex Court in Gopal Krishnaji v. Mohd Haji Latif, AIR 1968 SUPREME COURT 1413. Hence, the learned counsel submitted that the Second Appeal will have to be allowed.
11. Pending Second Appeal, the third defendant died. Since no steps have been taken, the Second Appeal is dismissed as abated against the 3rd defendant.
12. The learned counsel for the second defendant submitted that in view of the additional written statement filed denying the factum of payment of Rs.250/- , the contention of the learned counsel for the appellant cannot be countenanced. Being the plaintiff it is for the appellant to substantiate its case. The Courts below have appreciated the evidence and rightly rejected the evidence of P.Ws.1 and 2 in view of the discrepancies found in their evidence. Hence, the Second Appeal will have to be dismissed.
13. The fact that Ex.A.1 has been executed by all the defendants has not been denied. When the second defendant has raised the plea that he has signed the document as a guarantor by way of a security, it is for him to establish the same to the satisfaction of the Court. Therefore, in view of the admission made by the second defendant, coupled with the statutory presumption available, this Court is of the view that there is nothing on record to establish the fact that Ex.A.1 has been executed by the second defendant by way of a security, and the debt has been discharged.
14. Merely because, there is some discrepancy in the evidence of P.Ws.1 and 2 regarding the receipt of the cheque said to have been issued by the second defendant, their evidence cannot be eschewed. The said discrepancies are not so serious as what is required is the fact as to whether the second defendant has issued the cheque or not. In support of the said contention, the appellant has produced documents regarding the entries made. The passbook produced by the appellant would show the receipt of Rs.249/- after deducting the incidental expenses. A notice was also given by the appellant to the second defendant to produce the relevant documents. The second defendant has also admitted in his evidence that he was having an account with the Permanent Bank, Thanjavur. Even though in the additional written statement filed, the second defendant has stated that he has not acknowledged the alleged payment of interest, it is seen that in the earlier written statement, it has been specifically stated that payments have been made as referred in the plaint. The second defendant himself has been doing business in finance. Even in the chief examination, he accepted his signature in Ex.A.1. He has also admitted in the cross examination that he has been making payment till 1977. Therefore, the evidence of the second defendant would clearly show that his case as projected that he has signed Ex.A.1 by way of a security cannot be accepted.
15. When the plaintiff has filed the document acknowledging the payment said to have been made by the second defendant and when a notice was given to him to produce the documents, namely the passbook of saving bank account and the counter foil of the cheque book, the failure to do so certainly attracts an adverse interference, more so when the defendant has admitted the execution of Ex.A.1. While the appellant filed the documents giving the correct entries of the amount paid by the second defendant, the appellant cannot produce any more documents, which only the second defendant can produce.
16. As discussed above, admittedly the second defendant was having an account and he has not denied the said fact. Therefore, the failure of the second defendant to produce the particulars of the receipt of the amount pertaining to the relevant period would warrant an adverse inference drawn against him. Considering the issue of adverse inference, the Hon'ble Apex Court in Gopal Krishnaji v. Mohd Haji Latif, AIR 1968 SUPREME COURT 1413 was pleased to hold as follows:
" 5. ... But the appellant has not produced either his own accounts or the account of the Dargah to show as to how the income from plot No.134 was dealt with. Mr.Gokhale, however, argued that it was no part of the appellant's duty to produce the accounts unless he was called upon to do so and the onus we. upon the respondents to prove the case and to show that the Dargah was the owner of plot No.134. We are unable to accept this argument as correct. Even if the burden of proof does not lie on a party the Court may draw an adverse inference if he withholds important documents in his possession which can throw light on the facts at issue. It is not, in our opinion, a sound practice for those desiring to rely upon a certain state of facts to withhold from the Court the best evidence which is in their possession which could throw light upon the issues in controversy and to rely upon the abstract doctrine of onus of proof. In Murugesam Pillai v. Gnana Sambandha Pandara Sannadhi, 44 Ind App 98 at p. 103 = (AIR 1917 PC at p. 8) Lord Shaw observed as follows:
'A practice has grown up in Indian procedure of those in possession of important documents or information lying by, trusting to the abstract doctrine of he onus of proof, and failing. accordingly, to furnish to the Courts the best material for its decision With regard to third parties, this may be right enough
- they have no responsibility for the conduct of the suit but with regard to the parties thee suit it is, in their Lordships' opinion, an inversion of sound practice for those desiring to rely upon a certain state of facts to withhold from the Court the written evidence in their possession which would throw light upon the proposition.' This passage was cited with approval by this Court in a recent decision - Biltu Ram v. Jainandan Prasad. Civil Appeal No.941 of 1965 D/- 15.4.1968 (SC). In that case, reliance was placed on behalf of the defendants upon the following passage from the decision of the Judicial Committee in Mt. Bilas Kunwar v. Desraj Ranjit Singh, 42 Ind App. 202 at p.206 = (AIR 1915 PC 96 at p.98): 'But it is open to a litigant to refrain from producing any documents that he considers irrelevant, if the other litigant is dissatisfied it is for him to apply for an affidavit of documents and he can obtain inspection and production of all that appears to him in such affidavit to be relevant and proper. If he fail, so to do, neither he nor the Court at his suggestion is entitled to draw any inference as to the contents of any such documents.' (6) But Shah, J, speaking for the Court stated:
'The observation of the Judicial Committee do not support the proposition that unless a party is called upon expressly to make an affidavit of documents and inspection and production of documents is demanded, the Court cannot raise an adverse inference against a party withholding evidence in his possession. Such a rule is inconsistent with illustration (g) of S. 114 of the Evidence Act, and also an impressive body of authority.'"
Therefore, this Court is of the view that the judgment and decree of the Courts below will have to be set aside and the suit is liable to be decreed.
17. This Court is also quite aware of the jurisdiction of this Court to exercise the power under Section 100 of the Civil Procedure Code. However, when the Courts below have wrongly appreciated the evidence, not considered them properly and acted contrary to the pleadings and evidence available on record, this court should certainly exercise the power under Section 100 of the Civil Procedure Code in order to render justice. Further the lower appellate Court has not at all considered the documentary evidence produced by the appellant. When the 2nd defendant after admitting the execution of Ex.A.1 has not proved his case of signing the document as a guarantor then on his failure to prove the same the suit is liable to be decreed. It is also nobody's case that the debt has been discharged.
18. Insofar as the question of limitation is concerned, once again the Courts below have not considered the same properly. Even though the appellant in the plaint filed originally has raised the plea of moratorium under the Debt Reliefs Acts, it has been subsequently stated that the defendants have made payments on various dates and that the last date of payment was on 20.02.1979. If the said date is taken into account as acknowledgement, then the suit is well within the limitation. That is the reason why both the defendants 2 and 3 have specifically contended in the written statement by raising the question of limitation. In fact, the written statement filed by the 3rd defendant would show that the same has been filed mainly on the basis of limitation. Moreover, the plaintiff has also filed an additional statement bringing to the notice of the Court that the payment made will have to be taken into consideration as acknowledgement of the suit debts. The Courts below have totally misconstrued the said position, but merely held that the defendants being the men of means, it is not open to the plaintiff to contend that the Debt Reliefs Acts would be applicable. The plea taken placing reliance on the Debt Reliefs Acts cannot be considered as the one, which is totally detrimental to the subsequent plea taken. The Courts below have totally misconstrued the issue involved in the suit. Accordingly, the substantial questions of law are answered in favour of the appellant.
19. In the result, the Second Appeal is allowed and the judgment and decrees of the courts below are set aside and the suit is decreed as prayed for. However, considering the fact that the 3rd defendant died pending appeal and no steps have been taken, the suit is dismissed as against the 3rd defendant. In the circumstances of the case, there is no order as to be costs.
sj To
1. The District Judge, Thanjavur.
2. The District Munsif, Thanjavur.