The main legal point established in the judgment is the admissibility and validity of the promissory note under the Negotiable Instruments Act, and the credibility of the defendant's defenses.

Prathiba M. Singh, J.

1. The present appeal arises out of a suit for recovery of Rs.7 Lakhs filed by the Respondent/Plaintiff (hereinafter “Plaintif”) against the Appellant/Defendant (hereinafter “Defendant”). The Trial Court has decreed the suit vide a hand-written judgment dated 5th March, 2012 running into 13 pages for a sum of Rs.7 Lakhs with interest @ 8% per annum from the date of filing of the suit till its realization.

2. The case of the Plaintiff in brief is that her husband Shri S.D. Jain had given a loan of Rs.10 Lakhs to the Defendant in cash for which a promissory note was executed by the Defendant. Out of the loaned amount, an amount of Rs.3 Lakhs was paid back and another promissory note for Rs.7 Lakhs was executed. The first promissory note of Rs.10 Lakhs is a photocopy of the original placed on record and the second promissory note of Rs.7 Lakhs has been placed in original. The suit was initially filed under Order XXXVII CPC. However, leave to defend was granted on 3rd August, 2006.

3. The Defendant then filed his written statement and took various pleas. The first plea of the Defendant was that he had a business relationship with the Plaintiff and the money was given by the Plaintiff towards a supply of glass wall frames and other items. The second plea was that it was impermissible in the Income Tax Act to pay a sum of Rs.10 Lakhs in cash. The third plea was that the signatures of the Defendant were obtained on the blank promissory note and the same was signed by the Defendant in good faith.

3. The Trial Court framed the following issues in the suit on 12th February, 2008:

“Issues:

1. Whether the defendant has signed blank promissory note? OPD.

2. Whether the suit is bad for non-joinder of necessary parties? OPD.

3. Whether the suit is barred under the provisions of Money Lending Act? OPD.

4. Whether the plaintiff is entitled to recover the suit amount? OPP.

5. Whether the plaintiff is entitled to interest? If so, at what rate? OPP.

6. Relief.”

4. The Plaintiff has herself appeared as PW-1 and deposed that her children had given her no objection to file the suit to recover the money. She stated that there were family relations with the Defendant. She also stated that out of the total amount of Rs.10 Lakhs, Rs.5 Lakhs were given by her, which were withdrawn from her bank in Sadar Bazar. She admitted that she was not present when the promissory note was signed by the Defendant.

5. Shri Rajan Jain, son of PW-1/Plaintiff appeared as PW-2. He stated that he was personally present when Rs.3 Lakhs was returned by the Defendant to his father. He admitted that he was not aware as to when the loan was given to the Defendant but he acquired knowledge of the same when a sum of Rs.3 Lakhs was returned in his presence.

6. The Defendant appeared as DW-1 and he took contradictory pleas in his evidence and cross-examination. He stated in his affidavit that the original promissory note of Rs.7 Lakhs does not bear his signatures and the same is not a document because it is torn and adhesive tape has been used to stick it together. He claimed that the Plaintiff had given him an advance amount of Rs.10 Lakhs as he wanted to place orders for glass items and on that basis, he obtained the signatures on a blank promissory note. He admitted that he had signed on the blank promissory note in good faith. In his cross examination, he admitted that he used to regularly visit the shop of the Plaintiff in Bhagirath Place. He took a complete U-turn in his cross-examination and stated that he has not signed any promissory note and when he was confronted with paragraph 7 of his affidavit, he claimed that the same was written by his counsel without informing him. He admitted that the promissory note bears the correct address of his firm. In effect his entire evidence was that since the second promissory note of Rs.7 Lakhs was torn, the same could not be relied upon.

7. The Trial Court held on issue no.2 that the Plaintiff had produced the successi