Madras High Court
S.Sornam vs N.Selvaraj on 29 March, 2012
Equivalent citations: AIR 2012 MADRAS 269, (2013) 2 BANKCAS 10.1 (2013) 1 NIJ 374, (2013) 1 NIJ 374
Author: T.Raja
Bench: T.Raja
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 29.03.2012 CORAM: THE HON'BLE MR.JUSTICE T.RAJA S.A.No.9 of 2007 and CRP (NPD) Nos.1204 and 1205 of 2006 and M.P.No.2 of 2007 S.A.No.9 of 2007 S.Sornam ... Appellant Versus N.Selvaraj ... Respondent Prayer: Second Appeal filed under Section 100 of CPC against the Decree and Judgment dated 29.08.2005 made in A.S.No.53 of 2004 on the file of the Court of the First Additional District Judge, Coimbatore, confirming the decree and Judgment dated 31.12.2002, made in O.S.No.79 of 1999 on the file of the Court of the First Additional Subordinate Judge, Coimbatore. For Appellant : Mr.K.Sankaran For Respondent : Mr.Sai Krishnan for M/s.Sai, Bharath & Ilan CRP (NPD) Nos.1204 and 1205 of 2006 S.Sornam ... Petitioner in both CRPs. Vs. N.Selvaraj ... Respondent in both CRPs. Prayer in CRP No.1204 of 2006: Petition filed under Article 227 of Constitution of India against the decree and order dated 29th day of August 2005 made in I.A.No.311 of 2005 in A.S.No.53 of 2004 on the file of the First Additional District Judge of Coimbatore. Prayer in CRP No.1205 of 2006 : Petition filed under Article 227 of Constitution of India against the decree and order dated 29th day of August 2005 made in I.A.No.463 of 2005 in A.S.No.53 of 2004 on the file of the First Additional District Judge of Coimbatore. For Petitioner in both CRPs. : Mr.K.Sankaran For Respondent in both CRPs. : Mr.Sai Krishnan for M/s.Sai, Bharath & Ilan COMMON JUDGMENT
Since CRP (NPD) Nos.1204 and 1205 of 2006 are arising out of I.A.Nos.311 and 463 of 2005 which are part and parcel of appeal in A.S.No.53 of 2004, they are jointly taken up together for common disposal.
2. The present second appeal has been brought by the defendant being aggrieved by the concurrent findings of both the Courts below.
3. The plaintiff / respondent herein filed a suit on the file of the learned Sub Judge, Coimbatore, for recovery of sum of Rs.40,000/- with interest at the rate of 18% p.a. from the date of suit till the date of realization. The appellant / defendant said to have borrowed a sum of Rs.40,000/-, by executing a promissory note, dated 09.09.1996, in favour of the plaintiff / respondent herein, on promise to repay the amount with interest at the rate of 18%. Since the defendant / appellant herein failed to repay the entire amount even after several demands in person and followed by a lawyer notice dated 29.08.1998, finding that the defendant / appellant herein has successfully evaded to make any payment even after the acknowledgment of notice, the plaintiff / respondent filed a suit for recovery of the sum of Rs.40,000/-.
4. The defendant also filed her written statement stating that the plaintiff / respondent herein was running a chit company by name, Kovai Thirumalai Raja Chits Corporation in Partnership and the defendant subscribed to the Chits. While so, the plaintiff had taken blank pronotes with the signature of the defendant. Even though the defendant subsequently discharged the chit amount, the blank pronotes obtained from the defendant has been fabricated as if a private loan was borrowed from the plaintiff, when no such private loan was borrowed. On that basis, the defendant prayed for dismissal of the suit.
5. During the enquiry, it came to know that the defendant / appellant herein has not produced any evidence to prove her case, because, when there was a lawyer's notice, dated 29.08.1998, issued by the plaintiff/respondent herein asking the defendant to make the repayment of the amount mentioned therein, even after the acknowledgment of the notice, no reply was sent rebutting the contents of the notice. However, by considering the respective contentions raised on both sides, the trial Court decreed the suit for recovery of the amount with future interest at the rate of 18% p.a. on Rs.40,000/- from the date of filing of the suit till the date of decree, by holding that the defendant had admitted her signature in the suit pronotes and therefore, the presumption under Section 118 of the Negotiable Instruments Act is attracted.
6. Aggrieved by the same, an appeal was filed before the learned First Additional District Judge, Coimbatore, in A.S.No.53 of 2004. The learned First Appellate Court has framed the following questions for consideration.
1) Whether the trial Court is right in drawing the presumption under Section 118 of the Negotiable Instruments Act in the present case?
2) Whether the trial Court is right in doing so despite the failure of the plaintiff to prove the passing of consideration under the suit pronote?
3) Whether the trial Court has failed to consider that the initial burden is on the plaintiff to prove the passing of the consideration under the suit pronote and on his failure to do so, the trial Court ought to have drawn adverse inference against the plaintiff?
4) Whether the trial Court is right in decreeing the suit without considering the status of the plaintiff as one of the partners in one of the financial concerns in which the defendant has subscribed to chit groups?
5) Whether the trial Court has failed to consider the defendant's plea that the signature obtained in the course of the said chit group is utilized, in the light of the document adduced on her side to prove the above aspect?
6) Whether the judgment decree of the trial court is legally and factually sustainable?
7) To what any other relief?
7. The learned First Appellate Court, after answering all the questions against the appellant, on the basis of two significant aspect, namely a) that since the defendant both in her written statement and witness box specifically admitted the signature in the pronote as that of her own, as per the ratio laid down in the Judgment of Division Bench of this High Court reported in 2002 3 MLJ 808 in Ramasamy Mooper vs. Ramasamy Moopanar, the Court is bound to draw the presumption under Section 118 of the Negotiable Instrument Act against the defendant that the Negotiable Instrument is made or endorsed for consideration and b) that the defendant cannot, now contrary to the legal presumption, be permitted to argue that the suit pronote is not supported by consideration, affirmed the judgment and decree passed by the learned Trial Court. As against the same, the present second appeal has been filed finding fault with the concurrent findings of the Courts below.
8. One another argument was raised before the first appellate Court that the defendant has lost her husband and has been employed during the relevant point of time as Water-maid in Sri Avinashilingam University, Coimbatore. While so, the question of the plaintiff lending a sum of Rs.40,000/- without verifying the defendant wherewithal to repay the payment would not have arisen and the said argument was dismissed by the First Appellate Court holding that the same was factually untenable for the reason that the defendant having admitted to have subscribed for chits and having stood as guarantor for others, cannot be now permitted to say that she is in poor financial condition to be lent huge sum of Rs.40,000/- by the plaintiff. Under these circumstances, the second appeal has been filed.
9. This Court framed two substantial questions of law which are given as under:
a) In the absence of any presumption under Section 118 of Negotiable Instrument Act relating to the execution of suit pronote, can the presumption relating to the passing of consideration be applied to the facts of the case?
b) Whether the First Appellate Court is correct in not deciding the application filed under Order 41 Rule 27 CPC for additional documents before deciding the appeal as referred in the Judgment reported in 2006 9 SCC 748 (SANJIV GOEL V. AVTAR S.SANDHU)?
10. While addressing the substantial questions of law, the learned counsel for the appellant would submit that in the absence of any presumption under Section 118 of the Negotiable Instrument Act relating to the execution of the suit pronote, the Courts below should not have presumed that consideration has been passed from the plaintiff to the defendant. No doubt, the defendant is a widow as she lost her husband. But, during the relevant point of time, she was employed as water maid in Sri Avinashilingam University and during her period of employment, she stood as Guarantor. Further, the defendant had also admitted her signature in the pronote. Having admitted her signature in the pronote that she has put her signature only as a guarantor, the liability to the Guarantor is equal to the borrower. Under these circumstances, as a matter of fact, when notice was sent to her by the plaintiff before filing of the suit, the defendant after acknowledging the notice, refused to reply the presuit legal notice. Subsequently, in response to summon received form the trial Court, she filed her written statement giving no explanation for her failure to reply to the show cause notice. Though she denied the receipt of money, when accepting the signature in the pronote, it has been held by the Apex Court that the casual denial of passing of consideration does not act as a valuable defence because something which is probable has to be brought on records for getting the benefit of shifting the onus of proving the case to the plaintiff and the defendant has to bring on record such facts and circumstances. Upon consideration on which the Court may either believe that consideration did not exist or its non existence was so probable that a prudent man would under the circumstance of the case shall act upon the plea that it did not exist. Since the defendant did not succeed in establishing her case that no consideration has passed on her, I do not find any mistake or error in the Courts below taking the presumption under Section 118 of the Negotiable Instruments Act relating to execution of the pronote, more particularly when the defendant had accepted her signature in the pronote. Therefore, the first substantial question of law is answered against the appellant.
11. In respect of the second substantial questions of law whether the first Appellate Court is correct in not deciding the application filed under Order 41 Rule 27 CPC for additional documents before deciding the appeal?, a mere reading of the impugned Judgment shows that no prejudice has been caused to the appellant herein by deciding I.A.Nos.311 and 463 of 2005 filed in A.S.No.53 of 2004, when the appeal itself was decided along with that I.A. During the pendency of the first Appeal, the defendant / appellant herein filed the above mentioned two I.As. seeking permission of the court to receive 18 documents in the above said two I.As. The documents are 1) intimation card sent to the defendant from Thirumalai Raja Chit funds about the auction held in respect of three chits particulars of which are given in the same, 2) the receipt issued by Thirumalairaja chit funds to one Saroja Hari for the payment of amount towards chits, 3) the receipts issued of Kovai Thirumalairaja Finance Corporation to the same Saroja Hari for the payment of portion of principal amount in the loan account No.202 dated 14.09.1992. 4) the pass book in the name of sornam issued by Kovai Thirumalairaja Chits Corporation in respect of TGL 18.
12. After going through the documents, the learned First Appellate Court came to the conclusion that the reading of the documents would reveal that there are different companies by names 1) Thirumalairaja Chit Funds 2) Kovai Thirumalairaja Finance Corporation 3) Kovai Thirumalairaja Chits Corporation 4) Kovai Thirumalairaja Chits and Finance Corporation and 5) Thirumalairaja Finance, having their offices in different portions of Sree Krishna Towers. In the affidavits filed in support of I.A.No.311 of 2005, the defendant has stated that Ex.B1 relates to Thirumalairaja Chit Fund Corporation and the plaintiff was also found to be a partner in the chit called Thirumalairaja Chit Corporation and her lawyer advised her to trace out the records relating to her chit transaction with M/s.Thirumalairaja Chit corporation. Except that information other documents are not sufficient to prove the case of the defendant in any manner.
13. Even assuming that all documents are relating to the plaintiff's company, the First Appellate Court finally finding that those documents are nothing to do with the case of the defendant finally dismissed I.As. by giving findings that all these documents are not relevant to prove the specific plea either in the written statement or in the witness box, while she had admitted her signature in the pronote.
14. Moreover, the appellant cannot have grievance in I.As., filed under Order 41 Rule 27 code of civil procedure seeking for permission of the Court to adduce further evidence, not disposed of while dismissing the first appeal. When the reasoning given by the learned First Appellate Court of disposing both IAs are integral part of the impugned Judgment, I do not find any substance or any merits in the arguments advanced by the appellant. Order 41 Rule 27 CPC mandate the Court to dispose of the application before deciding the appeal. No doubt, non disposal of the said application would lead to miscarriage of justice. But, in the present case, the learned First appellate Court have discussed the merits of the document sought to be produced and only after coming to note that all the documents are no way relevant to the case of the defendant while dismissing I.A., dismissed the appeal also. Therefore, no error whatsoever can be find fault with while answering the substantial questions of law. Accordingly, the second appeal is dismissed.
15. In view of the reasons given in the second appeal, the Civil Revision Petitions in CRP (NPD) Nos.1204 and 1205 of 2006 are also dismissed finding no merits whatsoever. Consequently, connected miscellaneous petition is closed.
29.03.2012 ogy Index : Yes / No. Internet : Yes / No. T.RAJA, J.
ogy To
1. The First Additional District Judge, Coimbatore.
2. The First Additional Subordinate Judge, Coimbatore.
Pre-delivery Judgment in S.A.No.9 of 2007 and CRP (NPD) Nos.1204 and 1205 of 2006 29.03.2012