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High Court of Judicature at Madras
R. MAHADEVAN, J.
Naleena
Versus
Arumugha Padayachi
S.A. No. 411 of 2007
Decided on: 18-11-2014
Negotiable Instruments Act - Section 118(a) – Dishonor of cheque - Whether suit promissory note is true genuine and after due consideration - Recovery of money - Suit was resisted by defendant contending that defendant did not borrow a sum of or any other date and he did not execute any promissory note in favor of plaintiff and plaintiff had no capacity to advance such an amount - By way of clarification it is contended by defendant that he had approached husband of plaintiff seeking a loan for which he was asked to collect a sum from one who owed such amount to husband of plaintiff and his signature was obtained by defendant on a stamped blank paper and accordingly plaintiff had collected such amount and thereafter husband of plaintiff paid a sum and another sum of and thereby defendant had availed a loan only from husband of plaintiff and even towards such loan bags of paddy per bag was delivered to him and hence said loan was fully discharged - It is further contended by defendant that on a misunderstanding that arose in partnership business run by defendant and husband of plaintiff in taking cashew from Forest Department in auction husband of plaintiff had fabricated suit promissory note and hence prayed for dismissal of suit – Held, From above decision it is pellucid that if defendant is proved to have discharged initial onus of proof showing that existence of consideration was improbable or doubtful or same was illegal onus would shift to plaintiff who would be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to grant of relief on basis of negotiable instrument - It is also discernible from above decision that if defendant fails to discharge initial onus of proof by showing non-existence of consideration plaintiff would invariably be held entitled to benefit of presumption arising under Section 118(a) in his favor - In instant case on hand defendant had not denied his signature in promissory note and execution of same for consideration - Though it is specific case of defendant that amount borrowed from husband of plaintiff was repaid by way of giving bags of paddy per bag there is absolutely no acceptable evidence to show that debt was repaid by way of giving bags of paddy - In these circumstances this Court is of view that since defendant fails to prove nonexistence of consideration by bringing on record such facts and circumstances which would lead this Court to believe non-existence of consideration either by direct evidence or by preponderance of probabilities showing that existence of consideration was improbable doubtful or illegal plaintiff is entitled to benefit of presumption arising under Section 118(a) of Negotiable Instruments Act – Therefore case of defendant that suit promissory note is a fabricated one cannot be accepted - On other hand plaintiff has proved her means by producing sale deeds Exs.A4 and A5 standing in her name as rightly concluded by trial Court - When defendant fails to discharge initial onus of proof that he did not execute promissory note and receive any money from plaintiff or husband of plaintiff question whether plaintiff has any means to pay said amount does not arise - In view of above discussion in light of decisions cited above substantial questions of law are answered in favor of plaintiff/appellant herein - Appeal is allowed
1. Plaintiff, who succeeded before the Trial Court in getting decree for recovery of money but, failed in appeal, is the appellant in the second appeal.
2. The case of the plaintiff before the Trial Court was that on 07.04.1992, the defendant borrowed a sum of Rs.45,000/- from the plaintiff by executing a promissory note agreeing to repay the same with interest at the rate of 12% per annum, but, since the defendant has not cared for repayment of the amount, a notice was sent to him on 08.03.1995, which was served on 16.03.1995, but, the defendant has neither replied the notice nor repaid the loan amount and hence, the present suit had been filed.
3. The suit was resisted by the defendant contending that the defendant did not borrow a sum of Rs.45,000/- on 07.04.1992 or any other date and he did not execute any promissory note in favour of the plaintiff and the plaintiff had no capacity to advance such an amount. By way of clarification, it is contended by the defendant that he had approached the husband of the plaintiff seeking a loan of Rs.5000/- for which, he was asked to collect a sum of Rs.3,800/- from one Ponmudi, who owed such amount to the husband of the plaintiff, and his signature was obtained by the defendant on a stamped blank paper on 28.02.1991 and accordingly, the plaintiff had collected such amount from Ponmudi and thereafter, the husband of the plaintiff paid a sum of Rs.2,000/- on 06.12.1991 and another sum of Rs.1,000/-on 11.12.1991 and thereby the defendant had availed a loan of Rs.6,800/-only from the husband of the plaintiff and even towards such loan, 30 bags of paddy at Rs.300/-per bag was delivered to him on 10.02.1992 and hence, the said loan was fully discharged. It is further contended by the defendant that on a misunderstanding that arose in the partnership business run by the defendant and the husband of the plaintiff in taking cashew from Forest Department in auction, in the year 1993, the husband of the plaintiff had fabricated the suit promissory note and hence, prayed for dismissal of the suit.
4. The Trial Judge framed the following issues:-
i) Whether the suit promissory note is true, genuine, and after due consideration?
ii) Whether the plaintiff has got means to lend the suit amount?
iii) Is the defendant not liable to pay any amount to the plaintiff?
iv) Whether the plaintiff is entitled to the suit claim?
v) To what relief, the plaintiff is entitled?
5. Before the Trial Court, the plaintiff examined herself as PW1 while examining three more witnesses as PW2 to PW4 and marked six documents. The defendant examined himself as DW1 and marked four documents on his side. The Trial Court, on analysis of the oral and documentary evidence, decreed the suit as prayed for. On appeal, the appellate court, reversed the finding of the Trial Court and dismissed the suit. Aggrieved against the judgment and decree of the first appellate court, the present second appeal has been filed.
6. The second appeal has been admitted identifying the following questions to be the substantial questions of law involved in the second appeal:
i) Whether the finding of the lower appellate court that the plaintiff has no means to advance loan amount to the defendant, is erroneous in view of purchase of lands made by the plaintiff under Exs.A4 to A6?
ii) Whether the finding of the lower appellate court that the suit promissory note is fabricated one, is unsustainable considering the material evidence available on record?
7. The arguments advanced by Mr. R. Muralidharan, learned counsel for the appellant and by Mrs. R. Meenal, learned counsel appearing on behalf of the respondent are heard in detail. The materials available on record are also perused.
8. The suit is one for the relief of recovery of money. The plaintiff/appellant herein bases her claim on the suit promissory note, Ex.A1. The signature of the defendant found in Ex.A1 is not denied by the defendant. But, the case of the defendant is that he had approached the husban
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