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1975 Supreme(Mad) 115

IN THE HIGH COURT OF JUDICATURE AT MADRAS
T. Ramaprasada Rao and S. Ratnavel Pandian, JJ.
V.R.S.R.M. Ramaswami Chettiar and another .. .....Appellant(s)
Versus
Sri Devi Talkies by partner K. Ramakrishnan and others .. .....Respondent(s)
Appeal Nos. 260 and 533 of 1971.
Decided On : 27 February 1975

Advocates:
N.C. Raghavachari and N.S. Varadachari, for Appellant.
V. Shanmugham, for Respondent.

Burden of proof for presumption regarding passing of consideration.

Headnote:Negotiable Instruments Act, 1881-Section 118-Presumption as to passing of consideration.

       

Ramaprasada Rao, J. - These two appeals arise out of two original suits, O.S. Nos. 290 and 299 of 1970, on the file of the Court of the Subordinate Judge of Madu-rai. They are connected in the sense that the plaintiff in one suit (O.S. No. 290 of 1970) is the husband of the plaintiff in the other (O.S. No. 299 of 1970) and the defendants are common. For the purpose of convenience, We shall take up Appeal No. 260 of 1971 which is against the judgment and decree in O.S. No. 290 of 1970. The plaintiff’s case that defendant’s 2 and 3, partners of the first defendant, Sri Devi Talkies, borrowed a sum of Rs. 55,000 on 26th February, 1970 gave a bearer cheque on the Thanjavur Permanent Bank limited for the said amount, undertook to repay the amount within a few days thereafter and gave an assurance to the plaintiff that the cheque (Exhibit A-1) given by them could be presented for encashment after seventeen days. In furtherance of the assurance, as also in evidence of the borrowing, the defendants executed a letter Exhibit A-3, which also bears the same date as the bearer cheque. Under Exhibit A-3 the defendants unconditionally acknowledged that they had discounted the cheque for Rs. 55,000 for cash received, less discounting commission of Rs. 421.50. They also requested the plaintiff to present the cheque for payment on 15th March, 1970. The defendants undertook that, if the cheque was dishonoured for any reason, they would pay the said amount of Rs. 55,000 on demand together with interest at eighteen per cent, per annum till the date of payment. According to the plaintiff, though the thavanai period expired on 15th March, 1970 at the request of the defendants, the plaintiff did not present the cheque for payment until 4th May, 1970. When ultimately the cheque was sent to his bankers (Indian Bank, Town-hall Road Branch) for collection on 4th May, 1970, the same was dishonoured, and was returned with the endorsement “Refer to the drawer.”

2. Thereafter the plaintiff sent the suit notice (Exhibit A-5) dated 8th May, 1970 claiming the amount, together with interest. The reply (Exhibit A-6) given by the defendants is couched in dubious language. No doubt, the defendants deny the borrowing, but would say that the purpose for which the cheque had been issued had been suppressed by the plaintiff. They did not, however, disclose the so called purpose for which the cheque was issued by them. They would further maintain that due to some misunderstanding the notice was sent by the plaintiff and they reserved their right to file a “detailed statement”, disclosing all the particulars in respect of all the transactions they had with the plaintiff and also the purpose of which the cheque was issued. At the end, however, they would con-clude by saying that they were making arrangements to settle the plaintiff’s account. As the reply did not apparently satisfy the plaintiff, he instituted the present suit for the recovery of a sum of Rs. 58,025 with subsequent interest on the principal amount and the costs of the action.

3. Defendants 1 to 3 in their common written statement denied the suit claim and denied that the bearer cheque was given by them in consideration of the borrowing of cash made on 26th February, 1970. They would attribute motive to the plaintiff in the matter of the presentation of the cheque and the resultant endorsement obtained by him from his bankers, and would categorically allege that the plaintiff cheated them, on account of some ill-feeling and misunderstanding. According to them, the plaintiff was not possessed of sufficient funds on 26th February, 1970 to lend the sum of Rs. 55,000 on that day. They would refer to the other suit filed by the plaintiff’s wife, which is the subject-matter of Appeal No. 533 of 1971, which in turn arises from the judgment and decree in O.S. No. 299 of 1970 on the file of the same Court and would say that it was in connection with their dealings with the plaintiff’s wife that they gave the bearer



































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