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IN THE HIGH COURT OF KERALA AT ERNAKULAM
A. BADHARUDEEN, J.
FAKRUDHEEN S/O PUTHENVEETTIL SHAHUL HAMEED – Appellant
Versus
ABDUL KHADER S/O RAJUVEETIL PAPPA RAVUTHAR – Respondent
R.S.A. No. 867 of 2021
Decided On : 18-01-2024
Promissory Note - Negotiable Instrument Act - Section 118, Section 4, Section 2(22) of the Negotiable Instrument Act - The court discussed the essentials of a promissory note and the requirement of an attesting witness. It highlighted the provisions of the Negotiable Instrument Act and the Indian Stamp Act, emphasizing that no attesting witness is mandated for a promissory note and summarizing the essentials of a promissory note as per Section 4 of the NI Act.
Fact of the Case:
The plaintiff sued the defendant for repayment of a sum borrowed on the strength of a promissory note. The trial court found in favor of the plaintiff, and the appellate court confirmed the decision.
Finding of the Court:
The court found that the plaintiff succeeded in proving the borrowing and execution of the promissory note by the defendant, and the defendant's contentions were untenable.
Issues: The issues involved the borrowing and execution of the promissory note, the requirement of an attesting witness, and the existence of a substantial question of law for admitting the second appeal.
Ratio Decidendi: The court emphasized the essentials of a promissory note as per Section 4 of the NI Act and highlighted the mandatory formulation of substantial questions of law for admitting a second appeal.
Final Decision: The appeal was found to be meritless and dismissed without being admitted.
Key Points: - No attesting witness is mandated for a promissory note as per the Negotiable Instruments Act (!) (!) (!) . - Essentials of a promissory note include: instrument in writing, not a bank or currency note, unconditional undertaking, and payment to a certain person or bearer (!) (!) (!) (!) . - A substantial question of law must be formulated for a second appeal to be admitted under Order XLII Rule 2 (!) (!) . - The appeal was dismissed as no substantial question of law was found in the case (!) (!) . - The trial and appellate courts correctly evaluated the evidence and decreed the suit accordingly (!) (!)
JUDGMENT :
A. BADHARUDEEN, J.
1. This appeal is at the instance of the defendant in O.S. No. 1203/2013 on the files of the Munsiff Court, Kodungallur. The sole respondent is the plaintiff. The appellant assails decree and judgment in the above suit, which were confirmed in A.S. No. 5/2017 on the files of the Additional District Court, Irinjalakuda.
2. Heard the learned counsel for the appellant on admission and perused the verdicts under challenge.
3. The plaintiff instituted the suit to realise a sum of Rs. 75,000/- along with interest alleged to be borrowed by the defendant from the plaintiff on 10.11.2011, on the strength of a promissory note, allegedly executed by the defendant in favour of the plaintiff.
4. The defendant filed written statement. The contention raised by the defendant inter alia was that the defendant never executed any promissory note in favour of the plaintiff. Further contention was that when the defendant borrowed Rs. 50,000/- from the plaintiff to give advance to one M.Sanju in the year 2007, by executing an agreement, defendant signed and delivered blank stamp papers, white papers and cheque to the plaintiff and the plaintiff misused the said papers and fabricated the promissory note.
5. The trial court ventured the matter. On the side of the plaintiff, PW-1 was examined and Exts.A1 to A5 were marked. DW-1 was examined and Exts.B1 to B5 marked on the side of the defendant.
6. The trial court found, on appreciation of evidence, that the oral evidence of PW-1 is believable to hold that the plaintiff succeeded in proving borrowing of Rs. 75,000/- by the defendant from the plaintiff on 10.11.2011, and the execution of Ext.A1 promissory note by the defendant, where the defendant failed to rebut the presumption under Section 118 of the Negotiable Instrument Act (hereinafter referred to as the N.I. Act for short), on proof of execution of Ext.A1.
7. Accordingly, the suit was decreed for a sum of Rs. 75,000/- along with 6% interest from 10.11.2011. Although appeal preferred, the appellate court also dismissed the appeal and confirmed the finding of the trial court.
8. At the time of hearing, the learned counsel appearing for the defendant/appellant reiterated the contentions in the written statement. According to him, no witness shown in Ext.A1 promissory note and nobody examined to prove the transaction. The same is fatal to the case of the plaintiff. He also submitted that no evidence available in this matter to prove the transaction.
9. On perusal of the judgments under challenge, as I have already pointed out, PW-1 given evidence to the effect that the defendant borrowed Rs. 75,000/- from the plaintiff on 10.11.2011 and in repayment of the said sum, Ext.A1 promissory note was executed. He also given evidence that a demand notice was issued on 05.02.2013 and the defendant failed to repay the amount or to send reply, even on accepting the legal notice. Although PW-1 was cross examined, nothing elicited to shake his version.
10. The trial court as well as the appellate court concurrently found that the evidence of PW-1 succinctly established the transaction led to execution of Ext.A1 promissory note and accordingly, the trial court decreed the suit and the appellate court concurred with the said finding.
11. Adverting to the contention raised by the learned counsel for the defendant, the questions arise for consideration are:
(2) What are the essentials of a promissory note?
12. While answering these questions, reference to Section 4 of the N.I. Act is apposite. Section 4 of the NI Act is as under:
13. Scanning Section 4 of the NI Act, the essentials of a promissory note ar
SupremeToday
The main legal point established is that no attesting witness is mandated for a promissory note, and the formulation of substantial questions of law is mandatory for admitting a second appeal.
The validity of a promissory note is upheld when supported by evidence of execution and consideration, and a second appeal requires substantial questions of law to be present.
The presumption of consideration in promissory notes under the Negotiable Instruments Act is rebuttable, placing the burden on defendants to prove non-existence of consideration.
The court affirmed that in appeals under Section 100 CPC, substantial questions of law must be present for intervention; otherwise, factual findings of lower courts are conclusive.
A second appeal under Section 100 of the CPC is only maintainable on a substantial question of law; mere appreciation of evidence or findings of fact by lower courts, including the validity of a prom....
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