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IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
T MALLIKARJUNA RAO, J.
Shaik Khadar Vali – Appellant
Versus
Shaik Maqbul and Others – Respondent
Second Appeal No.532 of 2009
Decided on : 02-01-2025

Advocates:
Advocate Appeared:
For the Appellant : T LAKSHMI NARAYANA
For the Respondent: G L NAGESWAR RAOO

The court reaffirmed that findings of fact by lower courts must not be interfered with unless shown to be perverse, and upheld the presumption of consideration under the Negotiable Instruments Act.

Headnote:(A) Code of Civil Procedure, 1908 - Section 100 - Negotiable Instruments Act, 1881 - Section 118 - Second Appeal for recovery based on promissory note - Trial Court decreed suit for Rs.3,98,800/, but the 1st Appellate Court reversed it - The Plaintiff demonstrated the validity of the promissory note and the existence of consideration - The 1st Appellate Court erred in its assessment of jurisdiction and the credibility of evidence - Court ruled that findings of fact should not be disturbed unless they are perverse or illogical. (Paras 24, 29, 31, 32)

(B) Evidence - Burden of Proof - The Defendants failed to rebut the presumption of consideration under Section 118 of the N.I. Act - A mere denial of the receipt of consideration does not constitute a valid defense. (Paras 29, 30)

(C) Jurisdiction - A suit based on a promissory note can be filed where the cause arose or where the Defendant resides, and the choice of filing does not negate jurisdiction. (Paras 23, 28)

Table of Content
1. appellant's claim based on promissory note. (Para 1 , 2 , 4)
2. defendants' denial of claim and counterarguments. (Para 5 , 6)
3. interplay between law and factual findings (Para 8 , 10)
4. substantial questions of law regarding jurisdiction and evidence sufficiency. (Para 12 , 14)
5. high court's jurisdiction under section 100 of cpc. (Para 17 , 18 , 19)
6. validity of promissory note (Para 22)
7. threshold for rebuttal in debt recovery (Para 25 , 29)
8. validity of the promissory note established. (Para 30 , 31)
9. conclusion - restoration of trial court's judgment. (Para 32 , 33)

JUDGMENT :

1. This Second Appeal, under section 100 of Code of Civil Procedure, 1908 (for short, 'C.P.C'), has been filed by the Appellant/Respondent/Plaintiff against the Decree and Judgment dated 07.04.2009, in A.S.No.302 of 2008 on the file of IV Additional District Judge, Guntur (for short, ‘the 1st Appellate Court’) reversing the decree and Judgment dated 22.09.2008, in O.S.No.735 of 2005 on the file of II Additional Senior Civil Judge, Guntur (for short, ‘the trial Court’).

2. The Appellant/Respondent is the Plaintiff, who filed the suit in O.S.No.735 of 2005 seeking recovery of Rs.3,98,800/- being the principal and interest from the Defendant based on the promissory note.

3. Referring to the parties as they are initially arrayed in the suit is practical to mitigate confusion and better comprehend the case.

4. The factual matrix, necessary and germane for adjudicating the contentious issues between the parties inter se, may be delineated as follows:

The 1st Defendant is the wife, and Defendants 2 and 3 are the sons of Shaik Abdul Rahiman, who borrowed a sum of Rs.3,00,000/-from the Plaintiff under a promissory note dated 08.08.2004, executed for his family's necessities. Shaik Abdul Rahiman agreed to repay the borrowed amount with interest at 24% per annum to the Plaintiff or his order upon demand. Shaik Abdul Rahiman passed away on 19.11.2005 without settling the debt under the promissory note. The Defendants 1 to 3, as legal heirs, inherited the estate of the deceased. Despite repeated demands, they have failed to repay the debt from the deceased's estate, which is in their possession. As such, the Defendants are liable to pay the principal amount, along with accrued interest and costs, from the estate of the deceased towards the discharge of the debt under the suit promissory note.

5. In the written statement, the Defendants refuted all the plaint averments and contended that Plaintiff could not lend Rs.3,00,000/- to Shaik Abdul Rahiman, the husband of the 1st Defendant and father of Defendants 2 and 3, or anyone else. They asserted that Shaik Abdul Rahiman did not need to borrow such a large sum for family necessities during his lifetime. He worked in the railways, earning a monthly salary of Rs.5,300/-. The Defendants further claimed that Mahaboob Basha, the father of the Plaintiff, had a history of lending money to others. Specifically, V. Venkateswarlu, who worked alongside Shaik Abdul Rahiman at the Railways in Guntur, was introduced to Mahaboob Basha by Shaik Abdul Rahiman. Venkateswarlu borrowed Rs.70,000/- from Mahaboob Basha but failed to repay the debt. It led to disputes between Mahaboob Basha and Shaik Abdul Rahiman, with the Defendants alleging that Plaintiff fabricated the suit promissory note to gain wrongful benefits. The Defendants maintain that the deceased Shaik Abdul Rahiman did not execute any promissory note in favour of Plaintiff during his lifetime, and as such, Plaintiff is not entitled to the claimed amount. Consequently, they argue that the suit should be dismissed.

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

    i. Whether the Plaintiff is entitled to recover of suit amount as prayed for?

    ii. Whether the suit promote dated 08.08.2004 is true, valid and binding upon the estate of the deceased Shaik Abdul Rahiman, which is in the hands of the Defendants?

    iii. Whether this Court ha

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