High Court of Judicature at Madras
S.A. KADER
S. Ranganathan
Versus
Kavari Animal and Others
A.S No. 481 of 1980
Decided On :Decided on: 23-03-1987
PROMISSORY NOTE - EXECUTION AND CONSIDERATION - BURDEN OF PROOF - LEGAL REPRESENTATIVES OF DECEASED PROMISSOR - EVIDENCE ACT, SECTION 114(G) - INTERPRETATION - PASSBOOKS AS BEST EVIDENCE - NON-PRODUCTION - PRESUMPTION OF UNFAVORABLE EVIDENCE - REVENUE STAMPS ON PROMISSORY NOTE - DIFFERENCES AND SUBSEQUENT AFFIXATION - SUSPICION OF GENUINENESS - WITNESS TESTIMONY - INCONSISTENCIES AND DOUBTS - COURT'S DISCRETION TO DISMISS SUIT - LEGAL PRINCIPLES ESTABLISHED.
Fact of the Case:
Plaintiff sued the defendants, legal representatives of the deceased Selvaraj, to recover money allegedly borrowed by Selvaraj on two promissory notes. Selvaraj died in an air crash before repaying the loans. The defendants denied the execution of the promissory notes and the passing of consideration.
Finding of the Court:
The court found that the plaintiff failed to establish the execution of the promissory notes and the passing of consideration. The court noted inconsistencies in the plaintiff's case, lack of independent evidence, and suspicious circumstances surrounding the promissory notes, such as differences in revenue stamps and non-production of passbooks.
Issues: 1. Whether the suit promissory notes were executed by the deceased Selvaraj? 2. Whether the suit promissory notes were true, valid, and binding on the defendants? 3. Whether the suit promissory notes were supported by consideration? 4. Whether the defendants were entitled to the benefits of Act IV of 1938 and Ordinance 8/75?
Ratio Decidendi: 1. The burden of proof lies on the plaintiff to establish the execution of promissory notes and the passing of consideration when suing the legal representatives of a deceased promisor. 2. The court may draw an inference that evidence deliberately kept out of court would be unfavorable to the party withholding it, as per Section 114(g) of the Indian Evidence Act. 3. Differences in revenue stamps and non-production of passbooks can raise suspicions about the genuineness of promissory notes. 4. Inconsistent and doubtful witness testimony may lead the court to dismiss the suit.
Final Decision: The court dismissed the plaintiff's appeal and upheld the lower court's decision that the suit promissory notes were not true and valid.
1. This appeal is against the judgment and decree of the court of the Subordinate Judge of Salem in O.S No.293 of 1975. The unsuccessful plaintiff is the appellant.
2. This is a suit on two promissory notes. The case of the plaintiff briefly is as follows: One Selvaraj was employed under the plaintiff in his proprietary concern Lakshmi Paper Industries. The said Selvaraj thed in an air crash and the defendants are his heirs and legal representatives. The first defendant is the mother, 2nd defendant is his wife and defendants 3 and 4 are his children. According to the plaintiff, the said Selvaraj constructed a house and for the said purpose he overdrew large sums of money from the partnership firm Interpack Industries of which he was one of the partners. As other partners insisted upon the repayment, the said Selvaraj borrowed a sum of Rs.5,000 from the plaintiff on 30.5.1972 and executed a promissory note therefor promising to repay the principal with interest thereon at 18% per annum. On the same day he borrowed another sum of Rs.20,000 and executed another promissory note promising to repay the amount with interest at 18% per annum. Both the amounts were borrowed to reimburse the amount drawn in excess from Interpack Industries. It is the further case of the plaintiff that the said Selvaraj paid Rs.1,000 on 25.8.1972 which was appropriated towards promissory note for Rs.5,000 and another sum of Rs.1,000 on 25.10.72 which was appropriated towards the promissory note for Rs.20,000. The said Selvaraj did not pay any further sum to the plaintiff and he thed in an air crash leaving behind him the defendants as his heirs. Hence the suit to recover the money from the assets of late Selvaraj in the hands of the defendants.
3. The claim is resisted by the defendants. It is denied that the said Selvaraj overdrew any sum from Interpack Industries or borrowed from the plaintiff Rs.5,000 and Rs.20,000 on 30.5.1972 and executed the suit promissory notes. It is also denied that the said Selvaraj paid Rs.1,000 on 25.8.72 and another sum of Rs.1,000 on 25.10.72. It was further contended by the second defendant that Selvaraj did . not construct a house . during his lifetime. It is the second defendant who purchased the house site in A.V.K.Nagar and constructed a house in the plot purchased by her with her own funds. The defendants emphatically denied the signatures of Selvaraj in the suit promissory notes and the passing of consideration therefor. It was also pointed out that the plaintiff has changed his case put forward in the notice and took up a different stand in the rejoinder. The first notice did not make any mention to the overdrawing by Selvaraj from Interpack Industries or the borrowings from the plaintiff to reimburse the amount. It is only in the rejoinder, the plaintiff has come forward with such a case. The defendants also denied that Selvaraj left any property. They also claimed the benefits of Act IV of 1938,
4. The plaintiff has filed a reply statement alleging that the second defendant had no money to construct any house and it was late Selvaraj who has put up the house. On the above pleadings, the following issues were framed for trial:
1. Whether the suit promissory notes, dated 30.5.1972 are executed by the deceased Selvaraj?
2. Whether the suit promissory notes dated 30.5.1972 are true, valid and binding on the defendant?
3. Whether the suit promissory notes are supported by consideration?
4. Whether defendants are entitled to the benefits of Act IV 38/72 and Ordinance 8/75?
5. Learned Subordinate Judge found on issues 1 to 3 that the suit promissory notes were not true and were not supported by consideration. As no arguments were advanced under Issue No.4 regarding the benefits of Act IV of 1938, the court below did not give and finding thereon. Learned Subordinate Judge suo motu took up the question of limitation and found that the suit was barred by time as it has been filed on 16.6.1975 more than three years
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