Andhra Pradesh High Court
K.A.Padmanabhaiah - Appellant
Versus
K.Subbaiah Setty - RESPONDENT
Decided On: 12-01-77
Petition under Sec. 115 of the Act V of 1908 praying the High Court to revise the order of the Court of the Munsif, Magistrate, Done Dated 7-12-76 and made in O.S. No. 365 of 1975.
( 1 ) THIS revision petition by the defendant under Section 115 cpc is directed against the decree and order in O. S. No. 365/1974 on the file of the Munsif Magistrate, Dhone, Dt. 7-12-1976.
( 2 ) THE defendant-petitioner on 12-8-1974 executed a pronote for Rs. 10,000/ in favour of one Kottoor Krishna Murthy Setty with interest at 12% per annum at Kurnool. The parties to the promissory note reside at Kurnool and they belong to Kurnool. On 15-11-1974, the said Krishna Murthy endorsed the promissory note for collection in favour of the plaintiff at Dhone. On the basis of that endorsement, the present suit was instituted before the Court of the learned district Munsif, Dhone. An objection was taken to the maintainability of the suit itself on the ground that the place of endorsement of the promissory note for mere collection does not clothe the court in whose jurisdiction the endorsement of the promissory note took place, with the jurisdiction to entertain the suit. The Court below rejected that objection and held that it has got jurisdiction. It is this decision that is sought to be revised in this revision petition.
( 3 ) SRI K. Somakonda Reddy, the learned Counsel appearing for the petitioner, contends that an endorsement merely for collection is distinct from general endorsement whereby the property in the promissory note may be transferred. Section 50 of the Negotiable instruments Act, 1881 which deals with the effect cf endorsement reads thus:-"section 50: The endorsement of a negotiable instrument followed by delivery transfers to the endorsee the property therein with the right of further negotiation; but the endorsement may, by express words, restrict or exclude such right, or may merely constitute the endorsee an agent to endorse the instrument, or to receive its contents for the endorser or for some other specified person. "
( 4 ) ADMITTEDLY, the endorsee here was constituted an agent to receive the contents for the endorser in this case. It is only a restricted endorsement because it restricts and excludes the right of transfer and it constituted the endorsee merely an agent of the endorser. The endorser, in this case, belongs to Kurnool. He could not have maintained his suit on the foot of the promissory note at any place other than at Kurnool. What the principal could not have done, his agent, the plaintiff, in this case, could not have done. There is therefore, considerable force in the contention putforth by the learned counsel for the petitioner that the Court will not have any jurisdiction within the local limits of which an endorsement constituting endorsee as an agent, took place. In support of the said contention, the learned Counsel relied upon a decision in Govindaswamy achari and others vs. Kandaswami Achari and others (1) AIR 1942 Madras 742, where Pantanjali Sastry J (as he then was) took the view on the basis of the language employed in Section 50 of the negotiable INSTRUMENTS ACT, 1881 that an endorsee of the type, we are concerned with here, merely constitutes an agent of the endorser.
( 5 ) THE court below relied upon a decision in Chittaruvu radhakrishna Murthy vs. Bollapalli Chandrasekhara Rao (2) 1966 (2) an. W. R. 282, where Gopal Rao Ekbote J (as he then was) dealt with the case of assignment of a promissory note. We are not, in this case dealing with the case of assignment. Patanjali Sastry, J in the case mentioned (1) supra held that the case of a restricted endorsement constitute endorsee as an agent of the endorser for collection of the amounts. Therefore, a decision dealing with the assignment has no application to facts of this case.
( 6 ) FOR the aforesaid reasons, I am satisfied that the District munsif at Dhone has no jurisdiction to entertain the suit on the basis of the endorsement. The revision petition is, therefore, allowed but in the circumstances without costs.
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