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2013 Supreme(Ker) 486
High Court of Kerala
THOMAS P. JOSEPH, J.
R. Padmanabha Pillai Alias R. Gopalakrishna Pillai
Versus
N. Velukutty Pillai
AS.No. 317 of 2002
Decided On : 23-08-2013
For the Appellant:Vakkom N. Vijayan, Advocate.
The burden of proof in loan transactions when payment is made by cheques and the admissibility and probative value of documentary evidence.
Headnote:
loan transaction - Joint Business - Ramachandran Vs. Velayudhan (1986 KLT 647), Muhammedkutty Vs. Abdulla (2002(1) KLT 669) - The court discussed the burden of proof in loan transactions when payment is made by cheques, the evidentiary value of passbooks and account books in joint business, and the admissibility of documentary evidence. The court also emphasized the need for expert opinion on disputed signatures and the opportunity for both parties to adduce further evidence.
Fact of the Case:
The respondent filed a suit for recovery of money, alleging that the appellant borrowed amounts for a copra business. The appellant denied the loan transaction, claiming a joint business and filed a suit for realization of a sum from the respondent.
Finding of the Court:
The court found that the trial court erred in placing the burden of proof on the appellant regarding the nature of the transaction covered by the cheques. It also noted deficiencies in the trial court's assessment of evidence and directed a remand for further trial and disposal of the suits.
Issues: The issues involved the nature of the transaction covered by the cheques, the existence of a joint business, and the admissibility and probative value of documentary evidence.
Ratio Decidendi: The burden of proof in loan transactions when payment is made by cheques, the evidentiary value of passbooks and account books in joint business, and the admissibility of documentary evidence.
Final Decision: The appeals were allowed by way of remand, setting aside the judgment and decree of the trial court and remitting the suits for fresh decision after giving both sides the opportunity to adduce further evidence.
1. The following points arise for a decision in these appeals arising from the common judgment and decree of learned Sub Judge, Mavelikkara in O.S.Nos.8 of 1990 and 54 of 1991.
(i) Whether the trial court was right in proceeding on the basis that when payment is made as per two cheques, it is for the appellant to prove that it was not by way of loan?
(ii) Whether the finding entered by the trial court as regards the loan transaction is legally correct and supported by evidence?
(iii) Whether the finding entered by the learned Sub Judge that there was no joint business between the appellant and the respondent is legally correct?
2. Respondent in A.S.No.317 of 2002 filed O.S.No.8 of 1990 for recovery of money on the allegation that the appellant is a dealerin copra business and borrowed Rs.25,000/- from him on 06.01.1988 and Rs.15,000/-on 18.02.1988. The said amounts were paid to the appellant by way of two cheques which were encashed by the appellant in due course of time. Appellant did not repay the amount due and hence O.S.No.8 of 1990 for recovery of the said amounts with interest.
3. Appellant denied that there was no loan transaction on 06.01.1988 or 18.02.1988. He claimed that he had joint copra business with the appellant from 25.11.1987 to 19.04.1988. Since the respondent withdrew from the joint business, accounts were settled and amounts were due to the appellant. For repayment of part of the said amount, respondent issued cheques dated 06.01.1988 and 11.8.1988. A further sum of Rs.42,630/-was also due from the respondent.
4. Appellant filed O.S.No.54 of 1991 for realisation of the said sum of Rs.42,630/- with interest. Respondent resisted that suit denying that there was any joint business. He asserted that the appellant borrowed amounts as claimed in the plaint in O.S.No.8 of 1990.
5. Learned Sub Judge recorded evidence in O.S.No.8 of 1990. Respondent gave evidence as PW1 and testified to his case. He proved Exts.A1 to A5 (it is not clear whether Ext.A5, document was actually marked in evidence as there is no mention of that document either in the appendix of the judgment or the A diary). Appellant gave evidence as DW1 and examined Dws.2 and 3 to prove the (alleged) joint copra business with the respondent. Exts.B1 to B6 were also proved.
6. Learned Sub Judge observed that when payments are made as per cheques (dated 06.01.1988 and 18.02.1988) it was for the appellant to show that it was not by way of loan but, payments were made towards amount due in the joint business. No such evidence is adduced by the appellant. Learned Sub Judge was also not impressed by the documents the appellant produced. Learned Sub Judge found that the alleged joint business is not proved and that the appellant borrowed the amount from the respondent as pleaded in the plaint in O.S.No.8 of 1990. A decree was passed in favour of respondent in O.S.No.8 of 1990 and O.S.No.54 of 1991 was dismissed. A.S.No.317 of 2002 arises from the judgment and decree in O.S.No.8 of 1990. A.S.No.318 of 2002 arises from the dismissal of O.S.No.54 of 1991.
7. Learned counsel for the appellant has contended that findings entered by the learned Sub Judge on the issues involved are erroneous. It is argued that there was no good reason not to accept the evidence of DWs.1 to 3 and the documents produced by the appellant. According to the learned counsel, Ext.B1 which is a passbook issued in the joint names of the appellant and the respondent, which fact that respondent when examined as DW1 has admitted would show that there was joint business between the respondent and the appellant. It is argued that Ext.B3, account book of the joint business was discarded by the trial court for flimsy reason that it does not contain the hand writing of the respondent.
8. Learned counsel for the respondent has contended that learned Sub Judge was right in concluding that there is no evidence of joint business between the respondent and the appellant. It is also argued tha
