IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
VENUTHURUMALLI GOPALA KRISHNA RAO, J.
J. Pradeep Kumar Reddy – Appellant
Versus
Palle Subba Reddy – Respondent
Second Appeal No. 431 of 2025
Decided On : 24-03-2026
JUDGMENT :
VENUTHURUMALLI GOPALA KRISHNA RAO, J.
1. This second appeal is filed aggrieved against the Judgment and decree dated 16.04.2025, in A.S.No.87 of 2023, on the file of the IV Additional District Judge, Kadapa, confirming the Judgment and decree dated 09.11.2023, in O.S.No.415 of 2018, on the file of the Principal Senior Civil Judge, Kadapa.
2. The appellant herein is the defendant and the respondent herein is the plaintiff in O.S.No.415 of 2018.
3. The plaintiff initiated action in O.S.No.415 of 2018 on the file of the on the file of the Principal Senior Civil Judge, Kadapa, with a prayer for recovery of Rs.10,53,200/- basing on two suit promissory notes dated 02.03.2017 & 07.07.2017 with subsequent interest and for costs.
4. The learned Principal Senior Civil Judge, Kadapa, after conclusion of trial, decreed the suit with costs. Felt aggrieved of the same, the unsuccessful defendant in the above said suit filed the appeal in A.S.No.87 of 2023, before the IV Additional District Judge, Kadapa. The learned IV Additional District Judge, Kadapa, dismissed the first appeal by confirming the judgment and decree passed by the trial Court. Aggrieved thereby, the unsuccessful defendant approached this Court by way of second appeal.
5. For the sake of convenience, both parties in the second appeal will be referred to as they are arrayed in the original suit.
6. The case of the plaintiff, in brief, as set out in the plaint averments in O.S.No.415 of 2018, is as follows:
The defendant borrowed an amount of Rs.3,00,000/- from the plaintiff on 02.03.2017 and executed a promissory note agreeing to repay the same with interest at 24% per annum either to the plaintiff or to his order on demand. The plaintiff further pleaded that again on 07.07.2017, the defendant borrowed an amount of Rs.5,00,000/- and executed a promissory note agreeing to repay the same with interest at 24% per annum either to the plaintiff or to his order on demand. The plaintiff further pleaded that despite his repeated demands, the defendant failed to repay the debt under the promissory notes and postponed the same on some pretext or the other, and as such the plaintiff is constrained to file the present suit.
7. The case of the defendant, as per the averments in the written statement is as follows:
The defendant pleaded that he never borrowed any amount from the plaintiff and he never executed any promissory notes. The defendant further pleaded that the alleged two promissory notes for Rs.3,00,000/- dated 02.03.2017 and Rs.5,00,000/- dated 07.07.2017 respectively were created and forged by the plaintiff with an intention to harass the defendant and to extract money from him, and further pleaded that the plaintiff never demanded that the defendant repay the amount in respect of the alleged two suit promissory notes debts and, as such, he prayed for the dismissal of the suit with costs.
8. On the basis of above pleadings, the learned Principal Senior Civil Judge, Kadapa, framed the following issues for trial:
1) Whether the suit two promissory notes dated 02.03.2017 and 07.07.2017 are true, valid and binding upon defendant?
2) Whether the plaintiff is entitled for suit claim as prayed for?
3) To what relief?
9. During the course of trial before the trial Court, on behalf of the plaintiff, P.W.1 was examined and Exs.A-1 and A-2 were marked. On behalf of the defendant D.W.1 was examined and no document was marked.
10. The learned Principal Senior Civil Judge, Kadapa, after conclusion of trial, on hearing the arguments of both sides and on consideration of oral and documentary evidence on record, decreed the suit with costs. Felt aggrieved thereby, the unsuccessful defendant in the aforesaid suit filed the appeal suit in A.S.No.87 of 2023, on the file of the IV Additional District Judge, Kadapa, wherein the following points came up for consideration:
1) Whether there any reasonable grounds to set aside or modified or to interfere in the decree and judgment passed by the trial Court?
2
The validity of a promissory note is established by the plaintiff's evidence of execution and consideration, while the defendant must prove claims of forgery or lack of consideration.
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.
In promissory note disputes, execution and consideration must be evidenced; failure to rebut presumption under Section 118 of the Negotiable Instruments Act affirms the validity of the notes. Upholds....
The presumption of consideration in promissory notes under the Negotiable Instruments Act is rebuttable, placing the burden on defendants to prove non-existence of consideration.
The court clarified the application of interest rates under CPC, emphasizing the need for reasonable rates based on the nature of the transaction.
The burden of proof shifts to the defendant when the court finds that the disputed signatures match the admitted signature. Failure to examine a key witness may not be fatal to the plaintiff's case.
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