IMPORTANT POINT
The presumption of consideration under Section 118 of the Negotiable Instruments Act is rebuttable, and the burden of proof can shift to the plaintiff if the defendant presents sufficient evidence to challenge the presumption.

JUDGMENT :

The unsuccessful defendant in O.S. No.213 of 2015 on the file of the II Additional District and Sessions Court, Erode (for brevity “the Trial Court”), is the appellant herein. Challenge is to the decree for money granted in the said suit which was predicated on a dishonoured cheque.

2. For the sake of convenience, the parties will be adverted to as per their rank before the Trial Court.

3. According to the plaintiff, the defendant borrowed a sum of Rs.23 lakhs from him on 04.11.2012 and issued a post-dated cheque dated 05.12.2012. The cheque that was presented for payment by the plaintiff was dishonoured on 27.12.2012. The plaintiff issued a notice on 04.01.2013 seeking repayment, and the defendant, having received the notice, did not send any reply. The defendant agreed to pay interest @ 12% per annum from the date of borrowal and the plaintiff restricted the claim to 9% per annum from the date of the suit. On the basis of dishonour of the cheque, a criminal case in S.T.C. No.459 of 2013 was also launched by the plaintiff before the Judicial Magistrate Court No.III, Erode, which was dismissed and on appeal by the plaintiff, there was conviction, which is challenged by the defendant in a revision and the said revision is pending.

4. The defendant resisted the suit contending that he never borrowed any money from the plaintiff. The plaintiff, who had the support of a local politician and M.L.A., joined hands with his power agent Jaffar Ali, trespassed into his office and took away some documents, including the dishonoured cheque, which were kept in his custody. There was no borrowal at all by the defendant and the cheque was not supported by consideration. Owing to the political influence the plaintiff and his close relative had, the defendant was not in a position to take the help of the police and take action against the plaintiff and the partners in crime.

5. On the above pleadings, the Trial Court framed the following issues:

1 Is it true that the suit cheque was issued for repayment of loan as claimed?

2. Is the suit cheque supported by consideration?

3. Is the plaintiff entitled for a decree for recovery of money, as claimed?

4. To what other reliefs the parties are entitled to?

6. Before the Trial Court, the plaintiff was examined as P.W.1 and one Jaffar Ali was examined as P.W.2 and Exs.A.1 to A.12 were marked. The defendant examined himself as D.W.1 and there was no documentary evidence on his side. Exs.A.1 to A.3 are the certified copies of the cheque, return memo and office copy of the legal notice, respectively. Ex. A.4 is the acknowledgment card; Ex.A.5 is the dishonour note issued by the bank. Ex.A.6 to A.11 are the documents which were alleged to have been handed over by the defendant to the plaintiff at the time of borrowal. Ex.A.12 is the certified copy of the sale deed, the consideration received on execution of which was used to advance the loan to the defendant by the plaintiff.

7. The Trial Court invoked the presumption under Section 118 of the Negotiable Instruments Act, 1881, and granted a decree, as prayed for, finding that the defendant had not chosen to reply to the legal notice issued by the plaintiff and it was not a normal human conduct for a person to have kept quiet and contend that the documents were snatched from him by force. The said judgment of the Trial Court is assailed in this appeal.

8. We have heard Mr. Ramanlaal, learned counsel for the defendant and Mr. Kingsly Solomon, learned counsel for the plaintiff.

9. The issue that emerges for the consideration of this Court is whether the defendant has rebutted the presumption under Section 118 of the Negotiable Instruments Act, 1881.

10. Mr. Ramanlaal, learned counsel for the defendant, would take us through the cross-examination of P.W.1 and submit that the evidence of P.W.1, by itself, would demonstrate that the entire case of borrowal is false. In support of this contention, he drew our attention to the judgment of the Hon'ble Supreme Court i