The presumption of consideration under Section 118(a) of the Negotiable Instruments Act, 1881, is rebuttable and the burden of proof shifts to the plaintiff if the defendant adduces acceptable evidence to prove that the promissory note was not supported by consideration.

JUDGEMENT :- Beni Madhab (since dead) brought an action on a handnote executed by the defendants for a sum of Rs. 1290/-, claiming recovery of the amount with interest. The handnote recited passing of cash consideration and the same was reiterated by the plaintiff in his pleading giving details as to how and why the money had to be borrowed by the defendants. According to the plaint, on 8-2-1967 the defendants were to purchase a parcel of land from Smt. Pranmohine Debi, wife of the present plaintiff (since substituted as appellant on the death of Beni Madhab). The defendants had not had enough money to cover the consideration payable to Pranmohini and hence they had to borrow the amount of Rs. 1290/- from Beni Madhab on executing the handnote and in turn they (the defendants) paid the same to the plaintiffs wife, Pranmohini. Total claim of the plaintiff stood at Rs. 1770/-, adding the interest on the amount. The case of the defendants was that no cash consideration had passed; the handnote was nothing but a security taken by the plaintiff for payment of the balance of the consideration amount that the defendants had agreed to pay to Smt. Pranmohini on due delivery of the demised land.

According to the defendants a sale deed was executed in their favour by Pran-Mohini evidencing a sale of an area of land measuring 3 kethas and 15 lechas and payment of the entire consideration amount had been shown in the sale deed but, however, Pranmohini and Beni Madhab were not in a position to deliver possession of the entire land on the data of the execution of the sale deed and assured the defendants to deliver the entire land. As such, the defendants did not pay a part of the consideration amounting to Rs. 1290/-. The defendants assured payment of the amount on due delivery of the entire land. As a security for the payment of the part of the consideration of the sale amounting to Rs. 1290/-, the handnote was executed. As the vendor and/or Beni Madhab could only deliver 2 kathas 18 lechas of land out of 3 kathas and 15 lechas, the defendants claimed that they were not liable to pay the balance of consideration amount stipulated in the sale deed and as such, they were not liable to pay the amount of Rs. 1290/- secured as payable under the handnote. In short, the plea of the defendants was that there was no passing of the cash consideration; the handnote was executed as security for the payment of the part of the consideration money of the land which remained unpaid and the liability of the payment of the amount being entirely dependent upon the question of delivery of possession of the entire land and the plaintiff having failed to fulfil the part of his contract viz., to deliver possession of the entire land, was not entitled to the amount secured by the handnote.

2. However, the consistent claim of the plaintiff was that he had paid the consideration in cash (vide paras 1 and 3 of the plaint),

3. At the trial the following issues were framed :

"1. Whether the suit is maintainable ?

2. Whether the suit is bad for non-joinder of parties ? 3. Whether the consideration amount stated in the handnote passed in cash ?

4. Whether the defendants are entitled to a compensatory cost, and, if so, to what extent ?

5. What relief, if any, are the parties entitled to ?"

4. The Munsiff decided the issues in favour of the plaintiff and decreed the suit. On appeal, the judgement and decree of the trial court were set aside. The appellate court held that there was a clear admission of the plaintiff that the defendants having failed to pay the entire consideration of the sale amount had executed the handnote for the unpaid part of the consideration amount. It held that the case of the plaintiff as to the passing of cash consideration was unreliable and decided the issue No. 3 against the plaintiff holding that no cash consideration had actually passed in respect of the handnote and the same was executed only for payment of the unpaid portion of the conside