Madras High Court
A.Anbukkarasu vs K.Santhanam on 22 September, 2010
Author: A.Selvam
Bench: A.Selvam
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 22/09/2010 CORAM THE HONOURABLE MR.JUSTICE A.SELVAM AS(MD)No.245 of 2009 and MP(MD)No.1 of 2009 A.Anbukkarasu .. Appellant/Defendant Vs. K.Santhanam .. Respondent/Plaintiff Appeal Suit filed under section 96 of CPC against the Judgment and decree dated 28.04.2009 passed in Original Suit No.177 of 2007 by the Additional District and Sessions Court/Fast Track Court No.III, Madurai. !For Appellant ... Mr.K.Periyasamy ^For Respondent ... Mr.R.G.Shankar Ganesh :JUDGMENT
Challenge in this appeal is to the Judgment and decree dated 28.04.2009 passed in Original Suit No.177 of 2007 by the Additional District and Sessions Court/Fast Track Court No.III, Madurai.
2. The respondent herein as plaintiff has instituted Original Suit No.177 of 2007 on the file of the trial Court praying to pass a money decree for a sum of Rs.6,20,616/- on the basis of the suit pronote dated 28.07.2007, wherein the present appellant has been shown as sole defendant.
3. The averments made in the plaint are that on 28.07.2007 the defendant has received a sum of Rs.5,75,000/- from the plaintiff so as to meet out his urgent needs and also family expenses and to that extent he has executed the suit pronote. The defendant has not repaid anything either towards principal or towards interest. Under the said circumstances the present suit has been instituted for the relief sought for in the plaint.
4. In the written statement it is averred that it is false to contend that on 28.07.2007 the defendant has received a sum of Rs.5,75,000/- from the plaintiff so as to meet out his urgent needs and also family expenses and to that extent he executed the suit pronote in favour of the plaintiff. The defendant has never borrowed anything from the plaintiff much less Rs.5,75,000/- . The plaintiff is the close relation of the defendant. The plaintiff wanted to reside in a portion of the residential house of the defendant. Considering the close relationship, the defendant has permitted the plaintiff to occupy a portion of his residential house and for the convenient enjoyment of the plaintiff he made some alterations and repair works. The plaintiff has demanded a sum of Rs.1,50,000/- from the defendant for the works done by him. Due to that a despair has arisen between them. The plaintiff has lodged a complaint against the defendant by way of demanding Rs.1,50,000/- before the Inspector of Police, Melur and the defendant has been directed to come to police station by the Inspector of Police, Melur for enquiry on 28.07.2007. After conducting enquiry the Inspector of Police, Melur has directed the defendant to pay a sum of Rs.75,000/- to the plaintiff and the Inspector of Police has also compelled the defendant to put his signature on a blank pronote and promised to return the same on payment of Rs.75,000/- by the defendant to the plaintiff. By believing the words of the Inspector of Police, Melur the defendant has put his signature on a blank pronote on 28.07.2007. No amount has been filled up in the said pronote. Next day the defendant has met the Inspector of Police, Melur and asked him to issue a xerox copy of blank pronote and accordingly he has given the same, wherein the defendant has found as if the said blank pronote has come into existence for a sum of Rs.5,75,000/-. The defendant has questioned the Inspector of Police, Melur and proposed to take action against the Inspector of Police, Melur. The defendant has not received any amount from the plaintiff and the suit pronote is not supported by consideration and the same has been obtained from the defendant by exercising fraud, threat and undue influence at the police station. There is no merit in the suit and the same deserves dismissal.
5. On the basis of the rival pleadings raised on either side, the trial Court has framed necessary issues and after considering the evidence available on record has decreed the suit as prayed for. Against the Judgment and decree passed by the trial Court, the present appeal has been preferred at the instance of the defendant as appellant.
6. The consistent case of the plaintiff is that the defendant has received a sum of Rs.5,75,000/- from the plaintiff on 28.07.2007 so as to meet out his urgent needs as well as family expenses and to that extent he has executed the suit pronote and since he failed to discharge his liability the present suit has been instituted.
7. The definite stand taken on the side of the defendant is that the plaintiff is the close relative of the defendant and he has been permitted to reside in a portion of the residential house of the defendant and for his convenient enjoyment he effected repairs as well as alterations and subsequently he demanded Rs.1,50,000/- from the plaintiff and due to that a despair has arisen between them and thereafter the plaintiff has lodged a complaint on 28.07.2007 in Melur Police Station and the Inspector of Police, Melur has resolved the dispute between the plaintiff and defendant and finally directed the defendant to put his signature on a blank pronote and accordingly he put his signature and subsequently the Inspector of Police has given a xerox copy of the said blank pronote to the defendant and the defendant has found that the same has been filled up as if he has received the amount of Rs.5,75,000/- and in fact the suit pronote has not been executed by the defendant in favour of the plaintiff and the same has been obtained by exercising fraud, threat and undue influence and therefore, the present suit deserves dismissal.
8. The trial Court after meeting out the defence taken on the side of the defendant has decreed the suit as prayed for.
9. The learned counsel appearing for the appellant/defendant has attacked the Judgment and decree passed by the trial Court on the following grounds;
(a) On 01.07.2007 the plaintiff has given a complaint and on 11.07.2007 the defendant has given a complaint against the plaintiff. Under the said circumstances it is not possible on the part of the plaintiff to advance a sum of Rs.5,75,000/- on 28.07.2007 by way of getting the suit pronote from the defendant
(b) In the written statement it has been specifically pleaded that on 28.07.2007 the Inspector of Police, Melur has conducted enquiry on the basis of the complaint given by the plaintiff and subsequently compelled the defendant to put his signature on a blank pronote and accordingly he has put his signature and therefore, the suit pronote is not supported by consideration.
(c) The suit pronote has come into existence on 28.07.2007 and within a short span of four months, the present suit has been instituted without giving any prior notice and that itself has paved the way for coming to a conclusion that the suit pronote is not supported by consideration.
10. In order to repel the argument advanced by the learned counsel appearing for the appellant/defendant, the learned counsel appearing for the respondent/plaintiff has also equally contended that in between the plaintiff and defendant a dispute has been in existence with regard to money dealings and due to that the suit pronote has come into existence on 28.07.2007 and even assuming without conceding that on the date of execution of suit pronote the amount mentioned therein has not been given to the defendant by the plaintiff, since prior to execution of the suit pronote the defendant is liable to pay some amounts, the suit pronote has been executed in respect of past consideration and further it is false to contend that the defendant has put his signature on a blank pronote on 28.07.2007 and the defendant has been examined as DW1. He clearly admits in his evidence that the ink found in the signature as well as the ink found in the figure mentioned in Ex.A1 is one and the same and the trial Court after considering all the contentions raised on either side has rightly decreed the suit and therefore, the Judgment and decree passed by the trial Court do not warrant interference.
11. Before perpending the contentions urged on the side of the plaintiff, the Court has to look into the circumstances mentioned in the written statement, under which the suit pronote has come into existence.
12. At the end of paragraph-7 of the written statement, it has been stated like thus:
"Actually this defendant had not received any amount from the plaintiff towards the suit promissory note and the suit promissory note is not supported by any consideration much less cash consideration. The said blank pronote was obtained from this defendant by exercising fraud, threat and undue influence at the police station."
13. The specific stand of the defendant is that on 28.07.2007 the plaintiff has lodged a complaint in Melur Police station and the Inspector of Police, Melur has enquired the complaint given by the plaintiff and ultimately directed the defendant to pay Rs.75,000/- to the plaintiff and consequently directed him to put his signature on a blank pronote.
14. From the averments made in the written statement it is easily discernible that the specific stand taken by the defendant is that the suit pronote has come into existence by exercising fraud, threat and undue influence.
15. For the purpose of analysing the above legal as well as factual aspects, the Court has to look into sections 14 to 18 of the Indian Contract Act, 1872 (9 of 1872).
16. Section 14 of the said Act reads as follows:
"Free consent" defined.-Consent is said to be free when it is not caused by-
(1) coercion, as defined in section 15, or (2) undue influence, as defined in section 16, or (3) fraud, as defined in section 17, or (4) misrepresentation, as defined in section 18, or (5) mistake, subject to the provisions of sections 20, 21 and 22.
17. Section 15 of the said Act deals with coercion and the same reads as follows:
"Coercion" defined.-"Coercion" is the committing, or threatening to commit, any act forbidden by the Indian Penal Code (45 of 1860) or the unlawful detaining, or threatening to detain, any property, to the prejudice of any person whatever, with the intention of causing any person to enter into an agreement.
18. Section 16 of the said Act deals with 'undue influence' and the same reads as follows:
"Undue influence" defined.-(1) A contract is said to be induced by "undue influence" where the relations subsisting between the parties are such that one of the parties is in a position to dominate the will of the other and uses that position to obtain an unfair advantage over the other.
(2) In particular and without prejudice to the generality of the foregoing principle, a person is deemed to be in a position to dominate the will of another-
(a) where he holds a real or apparent authority over the other, or where he stands in a fiduciary relation to the other; or
(b) where he makes a contract with a person whose mental capacity is temporarily or permanently affected by reason of age, illness, or mental or bodily distress.
(3) Where a person who is in a position to dominate the will of another, enters into a contract with him, and the transaction appears, on the face of it or on the evidence adduced, to be unconscionable, the burden of proving that such contract was not induced by undue influence shall lie upon the person in a position to dominate the will of the other.
19. Section 17 of the said Act deals with 'fraud' and the same reads as follows:
"Fraud" defined.- "Fraud" means and includes any of the following acts committed by a party to a contract, or with his connivance, or by his agent, with intent to deceive another party thereto or his agent, or to induce him to enter into the contract (1)the suggestion, as a fact, of that which is not true, by one who does not believe it to be true;
(2)the active concealment of a fact by one having knowledge or belief of the fact;
(3)a promise made without any intention of performing it;
(4)any other act fitted to deceive;
(5)any such act or omission as the law specially declares to be fraudulent.
20. Section 18 deals with "Misrepresentation" and the same reads as follows:
"Misrepresentation" defined.- "Misrepresentation" means and includes-
(1)the positive assertion, in a manner not warranted by the information of the person making it, of that which is not true, though he believes it to be true;
(2)any breach of duty which, without an intent to deceive, gains an advantage to the person committing it, or any one claiming under him, by misleading another to his prejudice or to the prejudice of any one claiming under him;
(3)causing, however innocently, a party to an agreement, to make a mistake as to the substance of the thing which is the subject of the agreement.
21. In the instant case, it has already been pointed out that the specific attack made on the side of the appellant/defendant with regard to the suit pronote is that it has come into existence by exercising fraud, threat and undue influence. As per section 17 of the Indian Contract Act, 'fraud' means a suggestion as a fact, which is not true by one party who does not believe it to be true.
22. Section 15 of the said Act deals with 'coercion' or threat, wherein it is stated that coercion is nothing but committing or threatening to commit, any act forbidden by Indian Penal Code.
23. As per section 16 'undue influence' means that one party is in a position to dominate the will of other party and thereby obtained an unfair advantage over other.
24. Even at the risk of repetition, the Court would like to point out that the entire attack made on the side of the appellant/defendant with regard to suit pronote is that it has come into existence by exercising fraud, threat and undue influence. In the light of the discussion on the basis of the sections mentioned supra, it is needless to say that fraud, threat and undue influence are not synonymous. Each act is having its own distinct feature and one has no connection with other Act. Further it is made clear that details of fraud, threat and undue influence must be specifically averred in the pleadings. In the instant case on the side of the appellant/defendant it has been simply stated that the suit pronote has come into existence by exercising fraud, threat and undue influence. But no details of fraud, threat and undue influence have been mentioned in the written statement and that itself has completely debilitated the entire defence taken on the side of the appellant/defendant.
25. From the argument advanced by the learned counsel appearing for the appellant /defendant as well as the averments made in the written statement, the Court can deduce that the Inspector of Police, Melur has made undue influence over the defendant and thereby compelled him to put his signature on a blank pronote. In order to analyse the above aspect, the Court has to look into the decision reported in AIR 1967 Supreme Court 878 (Subhas Chandra Das Mushib V. Ganga Prosad Das Mushib and others), wherein the Honourable Apex Court has held as follows:
"The Court trying a case of undue influence must consider two things to start with, namely, (1) are the relations between the donor and the donee such that the donee is in a position to dominate the will of the donor, and (2) has the donee used that position to obtain an unfair advantage over the donor? Upon the determination of these issues a third point emerges, which is that of the onus probandi. If the transaction appears to be unconscionable, then the burden of proving that the contract was not induced by undue influence is to lie upon the person who was in a position to dominate the will of the other. Merely because the parties were nearly related to each other or merely because the donor was old or of weak character, no presumption of undue influence can arise. Generally speaking the relations of solicitor and client, trustee and cestui que trust, spiritual adviser and devotee, medical attendant and patient, parent and child are those in which such a presumption arises.
26. By way of vivisecting Section 16 of the Contract Act, 1872, the Court can easily deduce that for invoking the provision of the said section, following aspects must be present.
(a) there must be a fiduciary relationship between the parties
(b) one party is in a position to dominate will of other
(c) party who is having dominating position has obtained unfair advantage Unless these conditions are established, question of undue influence does not arise. Further it is made clear that initial burden of proving undue influence lies upon the person who pleads it. Further it is also made clear that if a transaction appears to be unconscionable, then the burden shifts upon the person who relies upon it.
27. In the instant case it has already been pointed out that in paragraph- 7 of the written statement it has been simply stated that the suit pronote has come into existence by exercising fraud, threat and undue influence and except mentioning of the words 'fraud, threat and undue influence', no where it has been stated about its details. Therefore, the main defence taken on the side of the appellant/defendant is not legally tenable and the same cannot be accepted.
28. Now the Court has to look into as to whether the suit pronote dated 28.07.2007 has been executed by the defendant and the same is supported by consideration as alleged on the side of the plaintiff. In paragraph-1 of the plaint it is stated like thus:
"The plaintiff submits that the defendant had borrowed a sum of Rs.5,75,000/- (Rupees five lakhs seventy thousand only) on 28.07.2007 from him for his urgent needs and family expenses."
29. The stand taken on the side of the defendant is that a dispute has been in existence between the plaintiff and defendant with regard to alteration of the house of the defendant and due to that a complaint has been given on 28.07.2007 in Melur Police Station, wherein the Inspector of Police has obtained the signature of the defendant on a blank promissory note and therefore the suit pronote is not supported by consideration.
30. The entire factual aspect mentioned on the side of the appellant/defendant is based upon Ex.B1 and Ex.X1. Ex.B1 is nothing but a blank promissory note dated 28.07.2007. The contention of the appellant/defendant is that after enquiry conducted by the Inspector of Police, Melur, the defendant has met him and asked him to give a xerox copy of the blank pronote, in which he put his signature. Since Ex.B1 is a blank pronote without containing signature of others except the signature of the defendant, the Court cannot give much adherence to it. As stated in many places, in the written statement it has been clearly pleaded that on 28.07.2007 an enquiry has been conducted by the Inspector of Police, Melur and he obtained the signature of the defendant on a blank pronote. The specific case of the plaintiff is that on 28.07.2007 the defendant has received a sum of Rs.5,75,000/- so as to meet out his urgent needs as well as family expenses and to that extent the suit pronote has come into existence. From the close reading of Ex.X1 the Court can easily come to a conclusion that on the basis of the complaint given by the plaintiff against defendant and on the basis of the complaint given by the defendant against the plaintiff, an enquiry has been conducted by the Inspector of Police, Melur and he subsequently resolved the dispute that existed between the plaintiff and defendant.
31. As stated in many places, the definite stand taken on the side of the defendant is that the suit pronote is not supported by consideration. From the reading of Ex.X1, the Court can easily come to a conclusion that the suit pronote has come into existence in Melur Police station. Now a legal question arises as to whether the suit pronote is supported by consideration. The complaint given by the plaintiff on 01.07.2007 is also found in Ex.X1, wherein it has been clearly narrated about the dispute that exists between the plaintiff and defendant and also the amount which is due from the defendant. Therefore, on the date of the suit pronote dated 28.07.2007 the defendant is bound to pay some amounts to the plaintiff. Even though on the date of execution of the suit pronote dated 28.07.2007 consideration has not been passed to the defendant, it is needless to say that as per section 2 (e) of the Indian Contract Act 1872, past consideration is also a good consideration. Therefore, it is needless to say that the defence taken on the side of the appellant/defendant to the effect that the suit pronote is not supported by consideration also goes out without merit.
32. The learned counsel appearing for the appellant/defendant has relied upon the decision reported in AIR 1979 Gauhati 46 (Beni Madhab Nath and others V. Juyandra Nath Barman and another), wherein it has been held that "where in a suit on a handnote the plaintiff asserts in the plaint a particular form of consideration which is the same as stated in the instrument and the same is found to be false, the plaintiff is forbidden to plead any other consideration because that would amount to making out a new case which was never pleaded by the party."
33. For analysing the decision referred to supra, the Court has to once again look into the relevant averments made in the plaint. In paragraph-1 of the plaint it has been simply stated that on 28.07.2007 the defendant has received a sum of Rs.5,75,000/- from the plaintiff and to that extent the suit pronote has come into existence.
34. It has already been pointed out that as per Ex.X1 the Inspector of Police, Melur has settled the money dispute that existed between the plaintiff and defendant and the suit pronote has come into existence in Melur police station. Further it has already been pointed out that legally a past consideration is a good consideration.
35. At this juncture, the Court has to look into the decision reported in 1992 - 2 MLJ - 152 (Vijayalakshmi and others V. Vasantha and others), wherein this Court has held that "it is the duty of the Court to give effect to the inference to be drawn from the evidence on record, even if the finding is not consistent with the pleadings of either party."
36. The definite stand of the plaintiff is that on 28.07.2007 the defendant has received a sum of Rs.5,75,000/- from the plaintiff and to that extent he has executed the suit pronote. But it has already been pointed out in many places that the suit pronote has been executed in respect of past money dealings between the plaintiff and defendant. Even though it is averred in the plaint that on 28.07.2007 the defendant has received a sum of Rs.5,75,000/- from the plaintiff by way of executing the suit pronote, from the available evidence, the Court can draw inference to the effect that the suit pronote is supported by consideration, even though it is not consistent with the averments made in the plaint. Therefore, the entire argument advanced on the side of the appellant/defendant goes out without merit.
37. Even assuming without conceding that the defendant has put his signature on a blank pronote, the Court has to look into section 118 of the Negotiable Instruments Act, 1881 and the same reads as follows:
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 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 burden of proving that the holder is a holder in due course lied upon him.
38. Even from a cursory look of the provision of the said section, it is pellucid that the Court can very well take a presumption to the effect that the suit pronote is supported by consideration. Therefore, viewing from any angle the entire defence taken on the side of the appellant/defendant is not having merit.
39. The trial Court after making elaborate discussion has rightly found that the suit pronote has been executed by the defendant and he is bound to give the suit amount to the plaintiff. In view of the foregoing elucidation of both the factual and legal aspects, this Court has not found any error in the Judgment and decree passed by the trial Court and altogether, the present appeal deserves dismissal.
40. In fine, this appeal deserves dismissal and accordingly is dismissed with cost. Connected Miscellaneous petition is also dismissed. The Judgment and decree passed in Original Suit No.177 of 2007 by the Additional District and Sessions Court/Fast Track Court No.III, Madurai are confirmed.
mj To The Additional District and Sessions Court/ Fast Track Court No.III, Madurai