BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 10/12/2008 CORAM THE HONOURABLE MR.JUSTICE A.C.ARUMUGAPERUMAL ADITYAN S.A.(MD)No.1028 of 2000 1.K.Sivakami .. Appellant/Appellant/ Defendant Vs. S.Krishnan .. Respondent/Respondent Plaintiff PRAYER This Second Appeal has been filed under Section 100 of CPC, against the judgment and decree in A.S.No.165 of 1999 dated 22.03.2000 on the file of Principal District Judge, Dindigul, confirming the judgment and degree passed in O.S.No.60/96 dated 24.12.1998 on the file of Subordinate Judge, Dindigul. !For Appellant ... Mr.Saravanan, Advocate for M/s.LA LAW ^For Respondent ... Mr.P.Vairava Sundaram :JUDGMENT
The appeal has been directed against the decree and judgment in
A.S.No.165 of 1999, on the file of Court of Principal District Judge, Dindigul.
The unsuccessful defendant before the Courts below is the appellant herein.
2. The suit promissory note is alleged to have been executed by the
defendant in favour of the plaintiff on 10.01.1993 for a sum of Rs.35,000/- with
interest at 12% per annum. The defendant had failed to repay the debt, the
plaintiff issued suit notice, dated 24.08.1993. The defendant has issued a
reply notice, dated 20.09.1993 containing frivolous contentions. The suit
promissory note was not executed as a security, for the loan borrowed by the
defendant’s husband, from Mangalam Finance Chit Corporation at Palani, as
alleged in the reply notice. The defendant’s husband had no transaction with the
Mangalam Finance at Palani, at any point of time. The defendant is an Income
Tax Assessee. Hence, the suit.
3.The defendant in his written statement would contend that the
defendant had not executed the suit promissory note on 10.01.1993 after
receiving a consideration of Rs.35,000/-, as alleged in the plaint. The
defendant does not know the plaintiff at any point of time. The defendant had
not executed any promissory note after receiving Rs.35,000/-, as alleged in the
plaint. At the instance of her husband, C.A.Kumar, the defendant had signed in
an unwritten promissory note. The plaintiff has concocted the suit promissory
note only for the purpose of this case. The defendant had married one
C.A.Kumar, some 6-1/2 years back. The defendant is working as a Professor in a
College, was getting more than Rs.5,000/- per month, towards her salary. The
defendant’s husband, C.A.Kumar, was not in cordial term with this defendant.
The defendant’s husband, C.A.Kumar, had joined in a chit by name, ‘Mangalam
Finance’, at Palani, had borrowed several loans from the said ‘Mangalam Finance’
and had also executed several promissory notes. The defendant’s husband has no
means to pay the said loan amount. Since the defendant was working as a
Professor and was earning to realise the loan amount from the defendant’s
husband, the plaintiff had threatened the defendant’s husband to get a
promissory note from this defendant as a security for the loan borrowed by him
(C.A.Kumar). Only at the instance of her husband, C.A.Kumar, the defendant had
signed in an unfilled promissory note. The defendant’s husband also threatened
to commit suicide, if the defendant refused to sign in the said unfilled
promissory note. Only under such circumstances, the defendant had signed in the
unfilled promissory note. The defendant is living separately from her husband
from May-1993. After knowing this fact, the plaintiff only to realise the suit
amount, has filed this suit against this defendant, who had not received any
amount under the suit promissory note from the plaintiff much less Rs.35,000/-.
For the suit notice received by her, the defendant had sent a suitable reply,
dated 20.09.1993. Both the execution and passing of consideration in respect of
the suit promissory note is denied by this defendant. In the Mangalam Finance
at Palani, apart from the plaintiff one N.M.Natarajan, S.M.Vairam, Pandian,
Jeganathan, Dhandapani are also partners. So far the defendant’s husband had
paid Rs.26,925/- to the Mangalam Finance in order to discharge the loan from the
said Mangalam Finance by him. The suit promissory note is a forged one, and
hence, the plaintiff is not entitled to any relief under the suit.
4.The plaintiff has filed a reply statement denying the averment in
the written statement, contending that under the suit promissory note a sum of
Rs.35,000/- was received by the defendant and that only to discharge the debt
borrowed by the defendant’s husband, the suit promissory note was executed by
the defendant in favour of the plaintiff and that there was no connection
between the plaintiff and the defendant’s husband, C.A.Kumar.
5.The defendant has filed an additional written statement contending
that she is not known to M.N.Natarajan and in his presence no amount was paid to
her, as contented by the plaintiff. On the above pleadings, the learned trial
Judge has framed two issues for trial.
6.Before the trial Court, the plaintiff was examined as P.W.1
besides examining one of the witnesses of Ex.A1, suit promissory note, viz.,
Thiru.Natarajan as P.W.2 and exhibited Exs.A1 to A3. On the side of the
defendant, D.W.1 and D.W.2 were examined and Exs.B1 to B5 were marked. The
letter written by the defendant’s husband, C.A.Kumar to D.W.2, Muthumanickam
were exhibited as Exs.X1 to X3.
7.After going through the evidence both oral and documentary, the
learned trial Judge, has come to a conclusion that the plaintiff is entitled to
a decree on the basis of suit promissory note, has decreed the suit as prayed
for. Aggrieved by the findings of the learned trial Judge, the defendant has
preferred an appeal in A.S.No.165 of 1999, before the learned Principal District
Judge, Dindigul, who, after giving due deliberations to the submissions made by
the learned counsel on both sides and after scanning the evidence let in before
the trial Court, finding no reasons to interfere with the judgment of the
learned trial Judge, has dismissed the appeal, thereby, confirming the decree
and judgment of the learned trial Judge, which necessitated the defendant to
approach this Court by way of this Second Appeal.
8.The following substantial question of law are involved in the
Second Appeal:-
“1.Whether the conditional admission of the signature alone in the
promissory note will lead to the presumption of passing of consideration also
under Section 118(a) of the Negotiable Instrument Act?
2.Will the burden of proof shift to the plaintiff if the normal
presumption as to consideration is rebutted by the evidence of the defence.”
9.Substantial Questions of Law Nos.1& 2:-
The plaintiff has filed the suit on the basis of Ex.A1, promissory
note, alleging that the same was executed by the defendant on 10.01.1993 after
receiving the consideration of Rs.35,000/- agreeing to pay interest at the rate
of 12% per annum. The defence taken by the defendant is that her husband,
C.A.Kumar, had borrowed the loan from Mangalam Finance, Palani, on very many
occasions and only as a security for the loan borrowed from the plaintiff by her
husband C.A.Kumar, the suit promissory note was executed by the defendant and
that no consideration was passed on to her but only to her husband C.A.Kumar.
The learned trial Judge relying on the judgment in Bharat Barrel Vs. Amin Chand
Pyarelal reported in (1999 1 CTC 497) has held that once execution of promissory
note is admitted by the defendant, the presumption under Section 118(a) of the
Negotiable Instrument Act, is that the amount promissory note is valid by
consideration, unless the plaintiff has rebutted the said presumption by letting
in further evidence on his side. Apart from examining himself as P.W.1, the
plaintiff has also examined one of the witnesses to Ex.A1, suit promissory note.
Thiru.Natarajan as P.W.2, in his evidence, has categorically deposed that Ex.A1
promissory note was executed in his presence by the defendant in favour of the
plaintiff and at the time of execution of Ex.A1, the plaintiff had handed over
Rs.35,000/- to the defendant, who had received the same. There is no recital in
Ex.A1 as to the effect that only for a security, as a loan borrowed by the
defendant’s husband C.A.Kumar from Mangalam Finance, Palani, the suit promissory
note was executed by the defendant. As rightly contended by the learned counsel
appearing for the respondent that even after filing of the suit, the defendant
had not sent any notice. The plaintiff contended that the suit promissory note
was executed only as a security for the loan borrowed by her husband C.A.Kumar
from Mangalam Finance at Palani and that no demand was made by the defendant
from the plaintiff for return of the suit promissory note, Ex.A1. Further, the
defendant, as D.W.1, would admit in her deposition in the cross-examination that
she has not filed any document to show that Mangalam Finance was conducting the
chit and that her husband was the subscriber of the said chit and had incurred a
debt with the said Mangalam Finance. The defendant would depose in her evidence
that only at the instance of her husband, as a security, she had signed in the
suit promissory note. But, the evidence of P.W.2, Natarajan is that the
defendant had executed the promissory note in the house of the plaintiff and
Ex.A1 is supported by consideration to the tune of Rs.35,000/-. There is
absolutely no material placed before the trial Court on the side of the
defendant to show that Ex.A1, suit promissory note was not supported by
consideration. There is no rebuttal evidence let in by the defendant to show
that Ex.A1, promissory note was not supported by consideration. On the other
hand, under Section 118(a) of the Negotiable Instrument Act, the presumption is
that once the execution of the promissory note is admitted, then it follows that
it is supported by consideration. Both the Courts below have concurrently held
that Ex.A1 is supported by consideration and the defendant is liable to pay the
suit amount.
10.The learned counsel appearing for the appellant would contend
that the trial Court has awarded 12% future interest for the suit promissory
note and admittedly, the suit loan was not for any commercial purpose. Under
Section 34 of the Code of Civil Procedure, the plaintiff can claim only 6%
future interest for the amount due under the suit promissory note, which was
admittedly executed to discharge the family debt and also to meet the family
expenses. Under such circumstances, I am of the view that the plaintiff is
entitled to only 6% future interest for the suit amount from the date of decree
till the date of realisation. Substantial Questions of Law Nos.1 & 2 are
answered accordingly.
11.In fine, the appeal is partly allowed with the following
modification in the judgment of the learned trial Judge. The plaintiff is
entitled to 6% future interest from the date of decree till the date of
realisation. In other respects, the decree of the first Appellate Judge in
A.S.No.165 of 1999, on the file of Court of Principal District Judge, Dindigul,
is confirmed. No costs.
Mpk
To,
1. The Principal District Judge,
Dindigul.
2. The Subordinate Judge,
Dindigul.