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1982 Supreme(P&H) 313

PUNJAB & HARYANA HIGH COURT
D.S.Tewatia, J.
Mateshwar Dayal
Versus
Amar Singh
Second Appeal No. 1843 of 1973,
Decided On : SEPTEMBER 22, 1982

Denial of execution of a pronote by the maker constitutes a waiver of the right to presentment under Section 76(c) of the Negotiable Instruments Act, 1881.

Headnote:

NEGOTIABLE INSTRUMENTS ACT, 1881 - SECTIONS 64, 69, 76(C) - WAIVER OF PRESENTMENT - DENIAL OF EXECUTION OF PRONOTE - IMPLICATION OF WAIVER.

Fact of the Case:

Plaintiff sought to recover money from the defendant based on a pronote. The defendant denied executing the pronote and claimed discharge of liability due to lack of presentment under Sections 64 and 69 of the Negotiable Instruments Act, 1881.

Finding of the Court:

The court found that the defendant's denial of executing the pronote amounted to a waiver of the right to presentment under Section 76(c) of the Act. The court relied on the Madras High Court judgment in C.M. Sivaram v. V.S. Jayaram Mudaliar, which held that presentment is unnecessary when the maker repudiates their obligation.

Issues: 1. Whether the defendant executed the pronote and receipt in dispute? 2. If issue No. 1 is proved, whether the pronote and receipt were without consideration? 3. Whether there has been proper presentation of the pronote? If not, to what effect? 4. Whether the plaintiff has no locus standi to file the present suit? 5. Whether the defendant is entitled to special costs under Sec.35-A, C.P.C.?

Ratio Decidendi: The court held that the defendant's denial of executing the pronote constituted a waiver of the right to presentment under Section 76(c) of the Negotiable Instruments Act, 1881. The court reasoned that presentment is unnecessary when the maker repudiates their obligation, as it would be futile and serve no purpose.

Final Decision: The court allowed the appeal, set aside the judgment of the first appellate court, and restored the judgment of the trial court, which had decreed the suit in favor of the plaintiff.

Judgment

1. The plaintiff-appellant Mateshwar Dayal (hereinafter referred to as the plaintiff) sought to recover Rs. 3,490/(Rs. 3,000.00 as principal and Rs. 490.00 as interest thereon) from Amar Singh, defendant-respondent (hereinafter referred to as the defendant) on the basis of pronote (Ext.P.1) dated 19th May, 1970.

2. The case as laid in the plaint by the plaintiff was that, he repeatedly asked the defendant to pay the said amount. He also sent a registered notice (Ext.P.4) to him on Jan. 27, 1971, to pay the amount covered by the pronote. Instead of paying the said amount, the defendant sent reply (Ext.P.3) dated Feb. 1, 1971, refuting his obligation and denying that he executed any pronote or took loan of any kind.

3. In the written statement, the defendant, inter alia, took the stand that there had been no presentment of the pronote and therefore he stood discharged of any obligation thereunder in view of the provisions of Secs.64 and 69 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the Act).

4. In the replication, the plaintiff, for one thing, averred that the presentation was not necessary and, for another, the pronote had been presented.

5. The trial Court struck the following issues :-

"(1) Whether the defendant executed the pronote and receipt in dispute? OPP.

(2) If issue No. 1 is proved, whether the pronote and receipt were without consideration ? OPD.

(3) Whether there has been proper presentation of the pronote? If not, to what effect? OPP.

(4) Whether the plaintiff has no locus standi to file the present suit? OPD.

(5) Whether the defendant is entitled to special costs under Sec.35-A, C.P.C.? OPD.

(6) Relief."

6. The trial Court found all issues in favour of the plaintiff and decreed the suit. On an appeal, at the instance of the defendant, the District Judge found all issues, excepting issue No. 3, in favour of the plaintiff. Under issue No. 3, it was held by the District Judge, that there had not been any presentation of the pronote and, therefore, the defendant stood discharged of his liability under the said pronote. In view of that finding, he allowed the appeal and dismissed the suit.

7. In the second appeal, the stand taken on behalf of the plaintiff is that, in view of the fact that the defendant refuted the factum of execution of any agreement or pronote and any obligation thereunder, he should be taken to have waived the right of presentment of the pronote in view of the provisions of S.76(c) of the Act. Mr. P.S. Jain, the learned counsel for the appellant, sought to sustain his above mentioned contention from a Division Bench judgment of Madras High Court, reported as C.M. Sivaram V/s. V.S. Jayaram Mudaliar, AIR 1966 Mad 297, and drew my pointed attention to its para No. 14, which reads as under :

"Finally, on the last point we are clearly of the opinion that both under S.76(c) as well as under general principles of law presentment is wholly unnecessary and would be futile in the instant case. It is settled law that when a maker refuses to pay the money or puts forward certain defences it is not necessary to present the bill for payment, and the maker would be deemed to have waived his right to require that the note should be shown to him. It must be held that the defendant must be deemed to have waived his right to take advantage of any default in presentment for payment. Due presentment is insisted upon solely for the benefit of the maker who is prepared to honour his obligation. But this requirement can obviously have no application to a party who repudiates his obligation. Waiver may not only be express but may also be implied and any conduct of the maker leading to the inference that the note if presented would not be honoured would dispense with the necessity of presentment. The principle of the decision in International Contractors Ltd. V/s. Prasanta Kumar Sur, AIR 1962 SC 77, clearly applies to the instant case. In that case a party who was bound to reconvey the proper










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