Presumption regarding promissory note executed as security

1. This appeal suit is directed against the judgment and decree dated 3.7.1987 made in O.S.No.130 of 1985 by the court of subordinate Judge, Dindigul thereby decreeing the suit, as prayed for, which had been filed by he respondent praying to pass a decree for a sum of Rs.31,706.25 with interest and costs.

2. To trace the history of the case, the respondent herein-filed the suit on averments that the defendant borrowing a sum of Rs.25,000 from the plaintiff on 29.7.1982 for his business, executed the suit pronote at Palani agreeing to repay the same with interest at 18% p.a. and since the defendant did not repay the said sum in spite of repeated demands, the plaintiff issued a notice dated 27.5.1985, for which the defendant issued a reply dated 4.7.1985 with false and untenable allegations, admitting the execution of the pronote but denying the circumstances under which it had been executed and further denying the passing of the consideration under the pronote and hence the plaintiff has come forward to file the suit for recovery of the sum of Rs.31,706.25 ps. with interest and costs.

3. On the part of the defendant, he would file a written statement generally denying all the allegations of the plaint much less the passing of the consideration of Rs.25,000 under the suit pronote. The defendant would further submit that there was no necessity for him to get such a loan nor had there been any compelling reason for him to borrow the said amount. The defendant would submit the circumstances under which the suit pronote had been executed on his part stating that his wife one Soundaravalli Ammal purchased a house property bearing door No. 16, Kamalathoppu Street in North Veli Street at Madurai,, which was belonging to an insane person viz. S.R.Venkataraman that the guardian of the said S.R.Venkataraman was none other than the wife of the plaintiff; that both the intended seller and the purchaser applied for necessary permission from the Court prior to the sale, which was vehemently opposed by some other claimants of the said property in the Court and ultimately the said objections having been overruled by the Court, the sale of the property was permitted to be done in favour of the wife of this defendant by the wife of the plaintiff acting as the guardian of the said insane person S.R. Venkataraman and ultimately the sale deed was also executed and registered that aggrieved, the defeated claimants to the said property filed an appeal before the High Court of Madras and since such appeal had to be jointly met with by both the wives of the plaintiff and the defendant, the wife of the plaintiff having taken charge of the expenses on the part of the defendant's wife, the defendant had to execute the pronote in favour of the plaintiff and as such there was no consideration passed on. The defendant would further submit that as it had been agreed among themselves, all the proceedings were conducted by the plaintiff’s wife for herself and on behalf of the wife of the appellant; that they have also obtained an amount of Rs. 12,200 for the expenses of prosecuting the appeal and on many other occasions also amounts have been paid; that apart from that, the defendant had also paid an amount of Rs. 15,000 to meet the expenses of the appeal in the High Court; that taking advantage of the clo se contacts, the plaintiff promising to return the pronote later, only sent the notice on 27.5.1985 claiming the pronote amount as though the same had been executed at Palani by the defendant. Hence, the case of the defendant, as pleaded, is that the suit pronote was not supported by consideration nor had the suit pronote been executed at Palani so as to file the suit in the trial Court and on such grounds, the defendant would pray to dismiss the suit with costs.

4. Based on the above pleadings, the trial court has framed two issues for determination, viz.

(1) Whether the suit pronote is not supported by consideration and whether the suit pronote h