Andhra Pradesh High Court
Boggarapu Subba Guruvaiah - Appellant
Versus
Domipadu Prahallada Rao - RESPONDENT
Decided On: 12-19-01
The burden of proof in establishing the validity of a promissory note and transfer of debt lies with the plaintiff, and failure to discharge this burden can lead to the dismissal of the suit.
Headnote:
Promissory Note - Recovery of Debt - Negotiable Instruments Act, 1882 - Indian Evidence Act, 1872 - A. P. (A. A.) Act IV of 1938 - [1, 2, 118, 58, A. P. (A. A.) Act IV of 1938]
Fact of the Case:
The appellant-plaintiff claimed that the 1st respondent-1st defendant borrowed a sum of Rs. 18,000 and executed a promissory note, which was later transferred to the appellant-plaintiff. The defendants denied the validity of the promissory note and the transfer, leading to a legal dispute.
Finding of the Court:
The Court found that the appellant-plaintiff failed to prove the execution of the promissory note and the passing of consideration, leading to the dismissal of the suit.
Issues: The issues included the validity of the promissory note, the assignment of debt, the recoverability of the debt from the 2nd defendant, and the relief sought by the appellant-plaintiff.
Ratio Decidendi: The burden of proof lay with the appellant-plaintiff to establish the validity of the promissory note and the transfer, which they failed to do. The Court relied on legal provisions and case law to emphasize the importance of discharging the burden of proof in such cases.
Final Decision: The appeal was dismissed, and the appellant-plaintiff was ordered to pay costs.
( 1 ) JUDGMENT the unsuccessful plaintiff in OS No. 63 of 1981 is the appellant. The appellant-plaintiff instituted the suit referred to supra on the strength of a promissory note dated 2. 9. 1978.
( 2 ) IT is the case of the appellant-plaintiff that the 1st respondent-1st defendant as manager of the joint family borrowed a sum of Rs. 18,000/- from one Shaik Abdul Khader s/o Mohd. Hussain, A. Kodur village, Nandyal Taluq and executed a demand promissory note in his favour on 2. 9. 1978 at Nandyal promising to repay the same with an interest at 1. 7 ps. per cent and the 1st respondent-1st defendant had not paid any amount due under the aforesaid promissory note. It was also further pleaded that the said Shaik Abdul Khader had transferred the said promissory note debt for consideration in favour of the appellant-plaintiff at Nandyal on 21. 8. 1981 and made an endorsement on the reverse of the promissory note and simultaneously he had assigned the said debt by executing an assignment deed and thus the appellant-plaintiff is entitled to recover the suit amount. Since the 1st respondent-1st defendant had not made any payment towards the said promissory note debt, the appellant-plaintiff was constrained to issue a legal notice and subsequent thereto had instituted the present suit. It was also further pleaded that since the amount was borrowed for joint family necessity, the 2nd respondent-2nd defendant also was impleaded as a party, being the son of the 1st respondent-1st defendant. It was also pleaded that the appellant-plaintiff came to know that the 1st respondent-1st defendant had created a partition deed showing as to the division between the 1st respondent-1st defendant and the 2nd respondent-2nd defendant and the said partition deed is only a sham and nominal document intended to defraud the creditors.
( 3 ) THE 1st defendant filed a detailed written statement. In para 4 of the written statement a specific stand was taken by the 1st defendant stating that the allegations in para 4 of the plaint are specifically denied. It was also further pleaded that the said Shaik Abdul Khader has absolutely no means to lend any amount much less the huge sum of Rs. 18,000/- and the appellant-plaintiff is also put to strict proof of the capacity of Shaik Abdul Khader to lend such amount. In para 5 of the written statement, the 1st defendant had pleaded as follows: "5. This defendant being given to bad company is addicted to drink and gambling. The said Shaik Abdul Khader, this defendant and one Yelisetty Subramanyam used to indulge in gambling with high stakes. When this defendant was in a drunken state, the said Shaik Abdul Khader might have obtained a promissory note said to be due in the activity of gambling from this defendant. It is relevant to submit that the other person Yelisetty Subramanyam had also obtained such similar promissory note from this defendant, the previous date i. e. 1. 9. 1978 for a similar sum of Rs. 18,000/- said to be due in the activity of gambling".
( 4 ) SEVERAL other facts have been pleaded in paras 6, 7, 8, 9, 10 and also 11 of the written statement. A specific stand was also taken that the appellant-plaintiff was not a bona fide holder in due course and cannot claim better rights than Shaik Abdul Khader himself and hence the appellant-plaintiff is put to strict proof of the alleged transfer endorsement and the alleged consideration said to be paid thereunder and also that it is endorsed on a sufficient stamp paper.
( 5 ) THE 2nd defendant also filed a written statement taking a stand that it is not true to say that the 1st defendant and 2nd defendant are members of Hindu joint family and that the 1st defendant was manager thereof, and a specific plea was taken that there was partition of joint family properties on 2. 11. 1979 under a registered partition deed. The 2nd defendant also had pleaded several other facts in paras 5, 6 and 7 of the written statement.
( 6 ) ON the strength of the re