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2006 Supreme(Kar) 301

IN THE HIGH COURT OF KARNATAKA AT BANGALORE
AJIT J. GUNJAL, J.
H.S. SRINIVASA - Petitioner.
Vs.
GIRIJAMMA AND OTHERS - Respondents.
Writ Petition No. 42481 of 2004 (GM-CPC).
Decided on 27th March, 2006

Advocates Appeared
Sri K. Raghavendra Rao, Advocate for Petitioner;
Sri Krishna S. Dikshith, Advocate for Respondents-1 to 6.

Headnote:Negotiable Instrument Act, 1881 -Denial of execution of an inchoate instrument -Section 20 -Denial of execution of an inchoate instrument -Holder is enabled under the provision to fill up the blanks -When execution denied, it should be tried by framing a necessary issue and the filling up the blanks would not preclude the defendant from contending that it is inadmissible in evidence etc. [Ajit J. Gunjal, J]: The question would be that what would be the repercussion if the said execution is denied by the defendant. But however the said question need not be decided in the present proceedings in the circumstances of the case. The said question can be agitated by framing an issue in a suit. At present justice requires that the petitioner should be allowed to fill in the name in the promissory note. This can certainly be done in the presence of the Registrar at a time appointed by him for the purpose. But however this filling up of the name of the holder will not preclude the defendant from raising the contention that the promissory note is inadmissible in evidence for want of proper stamp or that there were circumstances in the case to show that the petitioner had no authority; The question relating to the admissibility of the document and the proof thereof are left open to be decided during the course of the trial.

       Indian Evidence Act, 1872 -Inchoate instrument -Section 93 -Inchoate instrument -Making negotiable by filing up -Not hit by the provision. See, Negotiable Instruments Act, 1888 -Section 20.

       Negotiable Instruments Act, 1881 -Interpretation of -Section 20 -Interpretation of -Should be strictly construed.

       Negotiable Instruments Act, 1881 -Filling up of inchoate instrument -Section 20 -Filling up of inchoate instrument -Holder of the instrument -Has the statutory authority to fill up the blanks in the presence of Registrar and make it negotiable and such filling up is not hit by Section 93 of Evidence Act. [Ajit J. Gunjal, J]: A reading of Section 20 of the Act which is extracted above reveals that the words used are either wholly blank or having written therein an incomplete negotiable instrument . The instrument may be wholly blank or incomplete in particular in either case, the holder has the authority to make or complete the instrument as a negotiable one. The authority implied by a signature to a blank instrument is so wide that the party so signing is bound to be a holder in due course. Promissory notes are often executed in the name of the payer and left unfilled to be afterwards filled by the actual holder, the object being to enable the owner to pass it off to another without incurring the responsibility as an endorser. Thus it is seen that the person in possession of an incomplete instrument in material particulars, has the authority prima facie to fill it up and thus the executant becomes liable to pay the amount due.

ORDER

The petitioner is the plaintiff. He questions the order dated 29-8-2001 passed by the learned Trial Judge on I.A. No. XI in O.S. No. 213 of 1996, a copy of which is produced at Annexure-B.

2. During the course of this order, the parties would be referred to as per their rankings in the Trial Court.

3. The matter arises in the following manner:

One Janthakal Rajappa, the husband of defendant 1 and father of defendants 2 to 4 and one H.B. Padmanabha had approached the plaintiff-petitioner for the purpose of constructing and starting a business of bakery. An agreement was executed by late Janthakal Rajappa and H.B. Padmanabha in favour of the plaintiff on 29-9-1993. Under the said agreement late Rajappa had agreed to let out the building proposed to be constructed on a monthly rent of Rs. 7,001/-. On the same day, late Rajappa had received an advance amount of Rs. 51,000/- by cash. It is the case of the plaintiff that late Sri Rajappa borrowed a sum of Rs. One lakh each on two separate occasions from him and he has signed and delivered two promissory notes to the plaintiff. In one promissory note the name of the promisor and promisee was left blank and the interest column also was left blank. But however the amount borrowed i.e., Rs. One lakh was mentioned in words. The said promissory note was also signed by late Rajappa on two revenue stamps. In another pronote also the name of the promisor and promisee are left blank and the amount borrowed was mentioned as Rs. one lakh, which is written in words. Interest has also been mentioned at 2% per month per Rs. 100/-. The said pronote is also signed by late Rajappa on two revenue stamps.

4. Suffice it to say, the plaintiff filed a suit in O.S. No. 128 of 1994 for enforcement of the said agreement dated 29-9-1993. In the said suit the two blank promissory notes were produced. The promissory notes were kept in safe custody. Suffice it to say, an application I.A. No.7 was filed in O.S. No. 128 of 1994 to complete the two promissory notes as contemplated under Section 20 of the Negotiable Instruments Act. But, however, the learned Trial Judge has declined to complete the said inchoate instruments and has disposed of I.A. No.7 with an observation that it is open for the plaintiff to move the Court in a suit to be filed by him for recovery of money to fill up the blanks left in the promissory notes. In these circumstances, the present I.A. No. XI is filed in O.S. No.213 of 1996, which is filed for recovery of money with interest. The learned Trial Judge, as stated earlier, has rejected the said application on the ground that it is not permissible for the plaintiff to fill in the blanks of incomplete or blank promissory notes as it would be hit by Section 93 of the Indian Evidence Act, 1872. The learned Trial Judge was· also of the opinion that it is impermissible for the plaintiff to complete or fill in the blanks of the promissory notes.

5. Mr. K. Raghavendra Rao, learned Counsel appearing for the plaintiff would strenuously contend that the learned Trial Judge was clearly in error in rejecting the said application. He submits that under Section 20 of the Negotiable Instruments Act it is always open for the holder of the said document, namely, the promissory notes, to complete and fill in the blanks of the said promissory notes. In the circumstances, he submits that the learned Trial Judge was clearly in error in rejecting the application.

6. Mr. Krishna Dixit, learned Counsel appearing for the defendants would contend that even assuming that under Section 20 of the Negotiable Instruments Act it is permissible for the holder of the said documents to complete or fill in the blanks, but that could be done only in a case where the execution of the document is admitted. When the execution of the document is denied the question of invoking or taking recourse to Section 20 of the Negotiable Instruments Act is not at all permissible.

7. I have given my anxious consideration to the rival submission


















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