The execution of a Pronote establishes a legal presumption of consideration, shifting the burden of proof to the defendant to disprove it.

JUDGMENT :

1. Aggrieved over the dismissal of the suit filed for recovery of money on the basis of a Pronote dated 10.01.2007, the unsuccessful plaintiff has filed the present appeal.

2. The case of the plaintiff is that the defendant had borrowed a sum of Rs.15,00,000/- for her family expenses and also for improvement of her business and also to meet her other requirements and executed a Pronote dated 10.07.2007. As the amount is not paid, the plaintiff has issued a legal notice dated on 03.10.2007. Despite notice, the defendant did not pay the money. Hence, the plaintiff filed a suit in O.S.No.12840 of 2010 before the City Civil Court, Chennai.

3. According to the defendant, she had no personal business with the plaintiff and she is only a house wife. She has stated that her husband had borrowed a hand loan from the plaintiff for S.V.Home for aged, a registered Charitable Trust. The loan of Rs.5,00,000/- was borrowed after deducting interest of Rs.90,000/- and the loan amount was duly discharged by her husband. She has further stated that at the time of availing loan by her husband, as a security, a blank Promissory Note was issued on the plaintiff's insistence and on assurance given by the plaintiff that it would be returned back immediately after receipt of the loan amount by the Trust or by her husband. Despite discharge of the loan, the plaintiff failed to hand over the Pronote and instituted a suit with an intention to grab money from the defendant by misusing the blank Pronote.

4. On the side of the plaintiff, the plaintiff himself was examined as P.W.1 and Ex.A1 to Ex.A6 were marked. The defendant has examined herself as D.W.1 and marked 7 documents as Ex.B1 to Ex.B7 and her husband was examined as D.W.2.

5. The Trial Court has dismissed the suit on the ground that no scribe or attesting witness has been examined by the plaintiff to prove the passing of consideration. The Trial Court in fact has not considered the positive admission made by the defendant in respect of execution of the Pronote. Once a Pronote has been executed, it is for the defendant to bring out the probabilities so as to dislodge the legal presumption, which has not been done. Therefore, the judgment of the Trial Court is not valid in the eye of law.

6. Despite the name printed in the cause list, none appeared on behalf of the defendant.

7. Points for consideration is as to:

i) whether the First Appellate Court is right in shifting the burden on the plaintiff to prove the execution of Pronote, despite the admission made by the defendant?

ii) whether the defendant has proved the discharge as pleaded in the written statement?

8. Heard the learned counsel for the appellant and perused the material documents available on record.

9. The suit had been filed based on the Pronote marked as Ex.A1 dated 10.01.2007. The contention of the defendant was that at the time of her husband availing loan for a Charitable Trust, she had given a Pronote as a security on the insistence and assurance given by the plaintiff. Though it is the stand taken by the defendant that only a blank Pronote has been issued as a security, the fact remains that once a person issues a blank cheque, it authorizes the holder to make an entry to fill up the same. Section 20 of The Negotiable Instruments Act, 1881 reads as under:

“20. Inchoate stamped instruments -

Where one person signs and delivers to another a paper stamped in accordance with the law relating to negotiable instruments then in force in India, and either wholly blank or having written thereon an incomplete negotiable instrument, he thereby gives prima facie authority to the holder thereof to make or complete, as the cas