IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
M. VENKATA RAMANA, J.
Cheerala Rama Rao - Petitioner
Versus
Polimetla Ravindranath Tagore – Respondent
S. A. No. 564 of 2021
Decided On : 02-12-2021
Civil Procedure Code, 1908 - Section 100 - Negotiable Instruments Act, 1881 - Section 118 - Second appeal - Recovery of amount - Suit promissory note – Held, Capacity to raise money is one factor in this context to consider - It is not that he should have ready funds at his disposal for this purpose - Law does not contemplate such a situation - Therefore, when statements elicited in cross examination from respondent coupled with the nature of defence set up by the appellant is considered, inference to draw is as stated above, that respondent had necessary means and capacity and that he was able to raise funds to lend - The judgments of both Courts below, did not state these factors in so many words - Yet, conclusions drawn by both Courts below are based on facts. Therefore rightly the contention of the respondent were accepted holding that he had necessary means and capacity to lend by the date of Ex.A-1 - Second appeal dismissed.
JUDGMENT :
1. Heard Sri E.V.V. Ravi Kumar, learned counsel for the appellant.
2. Having regard to the nature of this matter and considering that it is based purely on fact situation whereby jurisdiction of this Court under Section 100 of Civil Procedure Code is not desirable to be exercised, this matter is now being disposed of.
3. The defendant is the appellant and the respondent is the plaintiff.
4. The respondent laid the suit against the appellant for recovery of Rs.5,73,900/- (Rupees Five lakhs seventy three thousand nine hundred only) on the foot of a promissory note dated 27.12.2013, for future interest and costs.
5. The case of the respondent, at the trial was that, the appellant had borrowed Rs.4,50,000/- (Rupees Four lakhs fifty thousand only) under the above stated promissory note agreeing to repay the same with 24% interest per annum upon executing it. His further case was that, the appellant had issued a cheque on Global Trust Bank Limited, M.G.Road, Vijayawada for Rs.1,00,000/- (Rupees One lakh only) towards part payment that was dishonoured when presented for payment. It was also his case that a notice was issued on behalf of respondent on 08.01.2015 to which the appellant got issued a reply on 13.01.2015, on which a rejoinder was issued by the respondent on 13.01.2015. In the circumstances, claiming that the appellant failed to repay the amount due inspite of demands, he laid the suit.
6. The substantial defence of the appellant at the trial was one on the denial of the transaction under the suit promissory note, calling it a rank forgery and devoid of consideration. The appellant also questioned the financial capacity of the respondent to lend such huge amount. He further contended that one Mr. Sunil with whom he had transactions earlier was instrumental in bringing out the suit promissory note and to make this false claim through the respondent.
7. On the pleadings, the trial Court settled necessary issues relating to proof of suit promissory note and if the respondent is entitled for the amount so obtained.
8. The parties went to trial, where, the respondent examined himself as PW1 and the alleged attestor to the suit promissory note as PW2. The respondent also relied on Exs. A-1 to A-5 in support of his contention and examined himself as DW-1, one of his bankers as DW2, while relying on Exs. B-1 to B-35 in support of his contention.
9. Upon the material and evidence, the trial Court rejected the defence of the appellant and accepting the claim of the respondent, decreed the suit with costs with future interest at 12 % per annum from the date of the suit till the date of decree and later at 6% per annum till realization.
10. The appellant preferred an appeal thereagainst. The appellate Court confirmed the findings of the trial Court leading to dismissal of the appeal. These are the circumstances that lead to presenting the second appeal.
11. Sri E.V.V. Ravi Kumar, learned counsel for the appellant strenuously contended that both the Courts below did not appreciate the evidence on record properly particularly, with reference to the defence of the appellant as to financial incapacity of the respondent to lend such huge amount under the alleged suit promissory note. The effect of suits and criminal cases pending against the respondent as per Exs. B-26, B-28, B-30, B-32 and B-34 which are all extracts downloaded from e-Courts website relating to these matters are pressed into service in this context.
12. Thus, learned counsel for the appellant strenuously contended that, when the respondent on his own showing is an employee who was drawing about Rs.30,000/- (Rupees Thirty thousand only) per month without any further means or source of income, could not have lent such huge amount under Ex.A-1 and in these circumstances, the defence of the appellant that the respondent is only name lender to and one Mr. Sunil with whom the appellant had transactions earlier is more probable. Therefore, in these circumstances when
The presumption of consideration under Section 118 of the Negotiable Instruments Act can be rebutted by the defendant by showing that he had sufficient financial capacity and did not need to borrow m....
The validity of a promissory note is upheld when supported by evidence of execution and consideration, and a second appeal requires substantial questions of law to be present.
The preponderance of probabilities and the burden of proof under the Evidence Act are crucial in civil cases.
The execution of a promissory note creates a presumption of consideration, which the defendant must rebut with credible evidence to avoid liability.
The admission of execution of a promissory note shifts the burden of proof to the defendant to prove that no consideration was passed.
The main legal point established is the burden of proof in a recovery of money case, where the plaintiff's evidence of the execution of the promissory note prevailed over the defendant's contradictor....
The presumption under Section 118 of the Negotiable Instrument Act can be invoked to establish the genuineness of a promissory note, and the burden lies on the defendant to rebut the presumption.
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