The simultaneous execution of a promissory note and a guarantee letter indicates a single transaction and joint liability.

JUDGMENT :

This Appeal, under Section 96 of the Code of Civil Procedure [for short ‘the C.P.C.’], is filed by the Appellants/defendants challenging the Decree and Judgment, dated 30.03.2007, in O.S. No.516 of 2006 passed by the learned I Additional Senior Civil Judge, Vijayawada [for short ‘the trial Court’]. The Respondent herein is the plaintiff in the said Suit.

2. The respondent/plaintiff filed the Suit for recovery of a sum of Rs.4,47,266/- being the principal and interest due on a promissory note dated 17.01.2004 executed by the first defendant in favour of plaintiff for Rs.3,00,000/- and for costs.

3. Both the parties in the Appeal will be referred to as they are arrayed before the trial Court.

4. The brief averments of the plaint, in O.S. No.516 of 2006, are as under:

The first defendant borrowed an amount of Rs.3,00,000/- from the plaintiff on 17.01.2004 for his necessities and executed a demand promissory note on the same day in favour of plaintiff agreeing to repay the same with interest at 18% per annum. On the same day the second defendant, who is the wife of first defendant, has given a hand letter undertaking to discharge the above said pronote debt personally. But inspite of several demands made by the plaintiff, the defendants 1 and 2 did not choose to pay any amount and has been postponing the same on one pretext or other. Plaintiff got issued a legal notice to defendants on 17.04.2006, but the defendants did not choose to receive the notice and return the same with intimation served. Hence the plaintiff is constrained to file the suit.

5. The first defendant filed a written statement separately by denying all the averments mentioned in the plaint and further contended as under: -

The first defendant borrowed only Rs.1,00,000/- from the husband of plaintiff by name Reddy Surya Rao, at that time Reddy Surya Rao obtained some cheques and some pronotes duly signed by this defendant as security. Subsequently, the first defendant paid the entire amount due with interest to the plaintiff’s husband on 15.11.2004, thereafter, the husband of plaintiff returned to the first defendant only one pronote and one filled cheque stating that the remaining pronotes and cheques were misplaced and he will return the same whenever they were traced out. The first defendant further pleaded that he is one of the directors and partners of Subhadarshi group, due to the disputes arose among the partners, this suit was filed against him.

ii) The second defendant filed written statement contending that the first defendant did not borrow Rs.3,00,000/- on 17.01.2004 from the plaintiff and she did not execute any undertaking letter and the said undertaking letter alleged to have been executed by the second defendant is a fake document and the suit pronote is not valid and the second defendant is not liable for suit claim and the suit is filed to have wrongful gain and the suit is liable to be dismissed.

6. Based on the above pleadings, the trial Court framed the following issues:

(i) Whether the suit pronote dated 17.01.2004 is true, valid, supported by consideration and binding on D1?

(ii) Whether the letter of undertaking dt.17.01.2004 is true, valid and binding on D2?

(iii) Whether the suit pronote has come into existence in the circumstances stated in the written statement of D1?

(iv) Whether plaintiff is entitled to recover the suit amount from defendant?

(v) To what relief?

7. During the course of trial in the trial Court, on behalf of the Plaintiff, PW1 to PW3 were examined and Ex.A1 to Ex.A6 were marked. On behalf of the Defendants DW1 and DW2 were examined, however, no documents were marked on behalf of defendants.

8. After completion of the trial and hearing the arguments of both sides, the trial Court decreed the suit with costs vide its judgment, dated 30.03.2007, against which the present appeal is preferred by the appellants/defendants in the Suit questioning the Decree and Judgment passed by the trial Court.

9. Heard Sri J.Ugranarasimham, le