Madras High Court
Raghavan vs V.Viswanathan on 21 December, 2017
Author: D. Krishnakumar
Bench: D. Krishnakumar
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Dated : 21.12.2017
CORAM:
THE HON'BLE MR. JUSTICE D. KRISHNAKUMAR
SA.No.695 of 2015
1. Raghavan
2. Shanthi
3. Nadhiya
4. Pravin
5. Minor Dayana
Rep.by its guardian /
mother Shanthi ..Appellants
Vs.
V.Viswanathan ..Respondent
PRAYER:
The Second appeal is filed under Section 100 of the Civil Procedure Code against the Judgment and Decree made in AS.No.20 of 2014 on the file of Subordinate Judge of Arni, Tiruvannamalai District dated 10.03.2015 reversing the Judgment and Decree on the file of the District Munsif, Polur, Tiruvannamalai District in O.S.No.257/2012 dated 28.01.2014.
For Appellants : Mr.K.V.Sanjeev Kumar for
M/s.Royan Law Asso.
For Respondent : Mr.T.Karunakaran
ORDER:
Gist of the case The respondent / plaintiff has filed a suit in O.S.No.257 of 2012 against the appellants / defendants to recover the principle amount of Rs.70,000/- along with interest at the rate of 2% per month. The first appellant / first defendant and one, Rajasekar had executed a promissory note in favour of plaintiff on 14.08.2009 in the presence of witnesses. Inspite of several reminders made by the plaintiff, the appellants herein did not repay the said loan amount. Therefore, the above suit was filed. The defendants filed a written statement denying the allegations made in the plaint. According to the first defendant, the first defendant and late Rajasekar never obtained any loan from the plaintiff on 14.08.2009. In the written statement filed by the first appellant / first defendant, the first appellant admitted that the deceased Rajasekar obtained a loan for urgency in the year 2003 and executed a promissory note in which the first defendant signed as witness. The aforesaid amount has also been repaid with interest. But the promissory was not returned stating that the same was misplaced. The said promissory note has been forged by the plaintiff and the same is barred by limitation. The defendants 2 to 5 have also filed a written statement. On the basis of the aforesaid pleadings, the trial court has framed issues whether the promissory note is a true and genuine document or forged one? On the side of the plaintiff / respondent, PW1 to 3 were examined as witness and Exs.A1 and A2 were marked as documents. On the side of the defendants / appellants herein DW1 and DW2 were examined and Exs.B1 to B5 were marked. By considering the individual evidence of PW1 to PW3, the court below has held that the plaintiff / respondent was not clear as to the place of execution of promissory note and never deposed that the defendant and late Rajasekar borrowed money in the presence of all the defendants. Hence, the plaintiff has not proved the execution of promissory note executed by the first defendant and late Rajasekar. Further, the court below has held that there is a material alteration of the month in Ex.A1 Promissory note and dismissed the suit holding that Ex.A1 promissory note is not a genuine document. Challenging the said Judgment and Decree passed by the trial court, the plaintiff / respondent has preferred an appeal in AS.No.20 of 2014 before Sub Court, Arani. The Appellate court by considering the pleadings in the written statement filed by the first defendant, wherein it was admitted that the Promissory note was executed by late Rajasekar in the year 2003 for the amount of Rs.10,000/- borrowed from the plaintiff. Considering the evidence of PW1 to PW3 and the signatures of Ragavan namely the first defendant and deceased Rajasekar in Ex.A1 allowed the appeal by holding that the appellant has proved by way of oral and documentary evidence that the said Promissory note is not fabricated or forged as alleged by the defendants and set aside the Judgment and Decree passed by the trial court. Challenging the aforesaid Judgment, the appellants / defendants have filed the Second appeal before the Court.
2. The learned counsel for the appellants / defendants would submit that well considered Judgment and Decree passed by the trial court has been reversed by the Appellate court without appreciating the case of the appellants that PW1 in his evidence was not clear about the amount and place of execution of Promissory note and there is contradiction in the evidence of PW1. Taking note of the said contradiction, the Appellate court has reversed the findings of the trial court, which is perverse and illegal. The Appellate court failed to appreciate the findings of the trial court especially on the issue of material alteration in Ex.A1 Promissory note. Further, it has been contended by the learned counsel for the appellants that the Appellate court has misinterpreted the facts and set aside the Judgment and Decree passed by the trial court.
3. Per contra, the learned counsel for the respondent would submit that in the written statement filed by the first defendant, it is contended that the promissory note marked as Ex.A1, executed by late Rajasekar for the earlier loan borrowed by him in the year 2003 has been misused by the plaintiff to file the present suit and in the said transaction, the first defendant has signed as a witness. Hence, the present promissory note in Ex.A1 is forged and a created document. Stating that there is also a material alteration in the Ex.A1, the trial court has disbelieved the execution of promissory note. The defendants have taken two inconsistent stand in the written statement that Ex.A1 promissory note was created and a forged document and that the said document was executed for obtaining a loan in the year 2003 by Rajasekar. It is admitted in the written statement itself that the first defendant has signed as a witness in the Promissory note. Therefore, the appellant cannot shift his stand that late Rajasekar and himself never executed any promissory note in favour of the plaintiff. From the evidence adduced on behalf of the plaintiff, plaintiff has proved that Ex.A1 Promissory note is genuine. Therefore, after considering the evidence adduced on the side of the plaintiff, the Appellate court has set aside the judgement and decree of the trial court and allowed the suit. Further, it it submitted that the trial court has not framed issues regarding material alteration in the suit. The trial court has framed issue whether promissory note is true and genuine or forged one. Therefore, the appellate court has rightly set aside the judgment of the trial court on the basis of the oral and documentary evidence and also on the basis of the admission made in the written statement and no other material has been placed by the defendants to substantiate his case that Ex.A1 is forged and created for the purpose of filing the suit. Therefore the second appeal is liable to be dismissed.
4. Heard, the learned counsel for the appellants and the learned counsel for the respondent and perused the materials available on record.
5. At the time of admission, the following question of law have been framed by this Court.
1) Whether the lower appellate Court is justified in holding the genuineness of Exhibit A1 as genuine against the finding given by the trial court?
2) Whether the Appellate court is correct in holding that the presumption of consideration in favour of the plaintiff in the absence of execution of proof of promissory note, can there be any initial presumption in favour of the plaintiff?
3) Whether the trial court is correct in allowing the appeal when the plaintiff has not proved the execution of the promissory note and burden of proving the consideration has passed would lie on the plaintiff?
6. From the above, it could be seen that the suit has been filed by the plaintiff / respondent herein for recovery of money on the basis of Ex.A1. Therefore, the point for consideration to decide the substantial question of law is whether Ex.A1 is genuine or forged as alleged by the appellants / defendants. The plaintiff / respondent relied upon the Ex.A1 Promissory note executed by late Rajasekar and the first defendant. The plaintiff has examined himself as PW1 and one, Sathyanarayanan as PW2. PW2 had deposed that ehd; thjpapd; Ciur; nrh;e;jtd; lhlh v tz;oia Xl;Lfpnwd;/ ehd; jhd; thjpapd; filf;F ntY}hpy; ,Ue;J bghUl;fis Vw;wp tUntd;/ mjdhy; v';fSf;Fs; beUf;fk; cz;L uh$nrfh; Kjypy; ifbaGj;ij ghz;oad; nky; nghl;lhh;/ ahUila ngdhtpy; vGj;ggl;lJ vd;W vdf;Fj; bjhpahJ/ ehd; vd; ngdhtpy; ifbaGj;J nghl;nld;/ ehd; ifbaGj;J nghl;Ltpl;L te;Jtpl;nld;/ utp ifbaGj;J nghl;lij ehd; ghh;f;ftpy;iy/ flDWjp;rrPl;il vGjpath; nghS:iu nrh;e;jtuh my;yJ nfS:iur; nrh;e;jtuh vd;W vdf;Fj; bjhpahJ/ flDWjpr;rPl;il vGjpa KUfd; ifbaGj;J nghl;lij ehd; ghh;f;ftpy;iy/ uh$nrfh; xnu xU ifbaGj;J nghl;lhh;/ uh$nrfh; ,we;j gpwF jhd; ,e;j tHf;F jhf;fy; bra;Js;shh; vd;why; uh$nrfh; vg;nghJ ,we;jhh; vd;W vdf;Fj; bjhpahJ/ uh$nrfhpd; thhpRfs; gw;wp vdf;Fj; bjhpahJ/ ehd; vd;Dila thf;FK:yk; jhf;fy; bra;a[k;nghJ ePjpkd;wj;jpy; cs;s flDWjpr;rPl;oy; cs;s ifbaGj;ij ehd; ghh;f;ftpy;iy vd;why; rhpjhd;/
7. It is useful to extract Section 118 of Negotiable Instruments Act as follows.
"Presumptions as to negotiable instruments-
118.Presumptions as to negotiable instruments- Until the contrary is proved, the following presumptions shall be made: -
(a) of consideration; that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration ;
(b)as to date; that every negotiable instrument bearing a date was made or drawn on such date ;
(c)as to time of acceptance; that every accepted bill of exchange was accepted within a reasonable time after its date and before its maturity ;
(d)as to time of transfer; that every transfer of a negotiable instrument was made before its maturity; (e)as to order of indorsements; that the indorsements appearing upon a negotiable instrument were made in the order in which they appear thereon;
(f)as to stamp; that a lost promissory note, bill of exchange or cheque was duly stamped ;
(g)that holder is a holder in due course; that the holder of a negotiable instrument is a holder in due course:provided that, where the instrument has been obtained from its lawful owner, or from any person in lawful custody thereof, by means of an SP offence or fraud. or has been obtained from the maker or acceptor thereof by means of an offence or fraud, or for unlawful consideration, the burthen of proving that the holder is a holder in due course lies upon him."
8. Admittedly, the plaintiff by examining the witnesses has proved the signature of the deceased Rajasekar who signed Ex.A1 Promissory note. Once execution of promissory note is proved, there is initial presumption of consideration in favour of the plaintiff. Thereafter, onus of proof rest on the defendant. According to the learned counsel for the respondent, fourth defendant has admitted that the documents namely bank account and salary register to prove that the signature of the deceased Rajasekar is not forged. The defendants have not taken any steps to send the document with admitted signature for expert opinion. Therefore, once plaintiff proved the execution, presumption under Section 118 of the Negotiable Instruments Act for consideration is inevitable. The decision of the Hon'ble Supreme Court in the case of Bharat Barrel & Drum Manufacturing Company Vs. Amin Chand Payrelal reported in (1999) 3 SCC 35, wherein it has been held as follows.
Once execution of the promissory note is admitted, the presumption under Section 118 (a) would arise that it is supported by a consideration. Such a presumption is rebuttable. The defendant can prove the non-existence of a 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 shift to the plaintiff who will be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to the grant of relief on the basis of the negotiable instrument. The burden upon the defendant of proving the non-existence of the consideration can be either direct or by bringing on record the preponderance of probabilities by reference to the circumstances upon which he relies. In such an event, the plaintiff is entitled under law to rely upon all the evidence led in the case including that of the plaintiff as well. In case, where the defendant fails to discharge the initial onus of proof by showing the non-existence of the consideration, the plaintiff would invariably be held entitled to the benefit of presumption arising under Section 118 (a) in his favour. The court may not insist upon the defendant to disprove the existence of consideration by leading direct evidence as the existence of negative evidence is neither possible nor contemplated and even if led, is to be seen with a doubt. The bare denial of the passing of the consideration apparently does not appear to be any defence. Something which is probable has to be brought on record for getting the benefit of shifting the onus of proving to the plaintiff. To disprove the presumption, the defendant has to bring on record such facts and circumstances upon consideration of which the court may either believe that the consideration did not exist or its non-existence was so probable that a prudent man would, under the circumstances of the case, act upon the plea that it did not exist.
9. The trial court has framed the following issues.
1. Whether the suit Promissory Note is a true and genuine document or forged one?
2. Whether the Plaintiff is entitled for the relief as prayed for?
3. To what other relief the Plaintiff is entitled for?
10. The trial court has considered the material alteration of the month under Ex.A1 Promissory note and rendered finding that there is material alteration in the Promissory note. However, no issue to that effect was framed by the trial court. No specific denial has been made by the appellant / defendant in respect of the said alteration. The Appellate court has held that the date of execution of the Ex.A1 has been shown that the promissory note was executed on 18.08.2009 only on the first line there is alteration in the month i.e. August instead of June. However, the trial court has not framed any issue regarding the said alteration. The next contention of the appellant that the aforesaid Promissory note executed under Ex.A1 is forged and fabricated. As rightly pointed out by the learned counsel for the appellant that the contemporary documents of the deceased Rajasekar has not been produced before the court below to disprove the signature of the deceased Rajasekar found in Ex.A1. Further, since execution of Ex.A1 is proved, the presumption under Section 118 (a) of the Negotiable Instruments Act support consideration. The defendants / appellants have not taken any steps to disprove documents before the trial court, when the initial burden of proof was discharged by the plaintiff by producing the necessary witnesses and documents. The learned counsel for the appellant would rely upon the decision of this Court in the case of Mahalingam Vs. Mayalagu reported in CDJ 2014 MHC 5870, wherein this Court has held as follows.
20.The word 'alteration' suggests 'change'. It also suggests 'correction'. In material alteration to the word 'alteration', there is the prefix 'material'. It is not mere alteration, it should be material in nature. An alteration, which is material with reference to the instrument, will become material alteration. It is such that it will change the legal character, enforceability, vital aspect of the instrument. An alteration as to the date, month, time and name are very important.
21.The year '2003' has been mentioned in the written statement. In such circumstances, when promissory note was produced during the trial, the appellant/defendant subjected the respondent/plaintiff and his witness to cross-examination as to the alteration in the year mentioned in Ex.A1. Further, in the written statement, appellant/defendant has took up the plea that no such promissory note as pleaded in the written statement has been executed by him.
22. The Principle of incohate instrument recognized in Section 20 of the Negotiable Instruments Act, pale into insignificance when the plea of material alteration is taken up. The ambit purpose and scope of Section 20 and Section 87 of Negotiable Instruments Act are different. Section 20 is intended to validate the Negotiable Instruments Act, whereas Section 87 is intended to invalidate the Negotiable Instruments Act.
23. Now, on examining Ex.A1, in the year, namely, '2003' number '3' has been altered. PW1 in his cross examination admits that number '3' in the year has been corrected. In his cross-examination, PW2 had stated that it is just a correction. This is not the version of PW1, PW2 is more loyal to PW1 and he wants to save the face of PW1, but he has damaged his case.
11. Further, in the case of P.Ramasamy Vs. K.Chinnammal reported in Indian Kanoon http://indiankanoon.org/doc/1575306/, wherein this Court has held as follows.
17. In the head notes of (2006) 2 MLJ 41 (supra), the decision relied on by the learned counsel for the respondent, it has been stated as follows:
Burden of proving that the promissory note was executed by the defendant, initially lies on the plaintiff As soon as execution of promissory note is proved, it shifts to the defendant If the defendant adduces direct evidence to prove that the promissory note was not supported by consideration, burden shifts back to the plaintiff. Trial Court has wrongly thrown the burden of proof on the plaintiff, after the execution was proved. Defendants have not adduced any evidence to prove that the document was not supported by any consideration. Trial Court has wrongly dismissed the suit.
12. Also in the case of Swamy Atmananda & Ors. Vs. Sri Ramakrishna Tapovanam & Ors reported in https://indiankanoon.org/doc/4504378/, wherein this Court has held has follows.
If the parties went to the trial knowing fully well the real issues involved and adduced evidence in such a case without establishing prejudice, it would not be open to a party to raise the question of non-framing of particular issue.
13. The learned counsel for the respondent has relied upon the decision of the Hon'ble Supreme Court in the case of Karunanidhi Vs. Seetharama Naidu and Others reported in (2017) 5 SCC 483, wherein it has been held that though High Court has power to formulate substantial question of law, but when a question was neither raised before the trial court, first appellate court or even before High Court and no pleading, issue and finding was recorded by courts below, the High Court cannot suo motu frame additional question of law in the second appeal.
14. In the light of the decisions cited supra, the trial court has not framed any issue on material alteration of the promissory note. No question of law has been raised before this Court regarding the material alteration in the Promissory note and no grounds have been raised impeaching EX.A1 on the ground of material alteration. Therefore, the contention that Ex.A1 is not a valid document on the ground of material alteration is liable to be rejected. The next defence taken by the appellant is that he disputing the signature in Ex.A1. According to the learned counsel for the defendants, the burden of proof lies with the plaintiff to prove the signature made in Ex.A1 under Section 118 of the NI Act. According to the defendant, the deceased Rajasekar had settled the loan amount to the plaintiff, but by misusing the signature in the Promissory note, Ex.A1 has been forged and created for the purpose of filing the suit. As the oral and documentary evidence proves execution of Ex.A1, the initial presumption of consideration is in favour of the plaintiff and therefore the defendant has to discharge the burden by producing necessary evidence to dispute the signature. In the facts and circumstances of the case, the evidence adduced by the plaintiff and the decisions cited supra, in the absence of any material to disprove Ex.A1, the Appellate court has rightly decreed the suit.
15. Therefore, the questions of law framed in the Second appeal is answered against the appellant. Therefore, there is no error or illegality in the judgment passed by the Appellate court. Hence, the Second Appeal fails and the same is dismissed. No costs.
21.12.2017
Speaking/Non-speaking order
Index :Yes/No
Internet : Yes/No
lok
[ Issue order copy on or before 31.01.2018]
To
1) The Subordinate Judge,
The Sub Court, Arni,
Tiruvannamalai District
2) The District Munsif,
The District Munsif Court,
Polur, Tiruvannamalai District
D.KRISHNAKUMAR. J,
lok
Pre-delivery Judgment
in SA.No.695 of 2015
21.12.2017