The importance of the defendant's admission in the written statement and deposition as a key factor influencing the court's decision.

L.K. Mohapatra, Actg. C.J.

This appeal arises out of the judgment and decree dated 31.3.2011 passed by the learned Civil Judge, Sr. Divn, Manipur West in Original (Money) Suit No. 6 of 2009. The respondent was the plaintiff in the suit. The case of the plaintiff-respondent is that he and the appellant are childhood friends and residents of the same locality. On 20.3.2007, the defendant-appellant, for the purpose of his business, requested the plaintiff-respondent for a loan of Rs. 1,60,000/- (Rupees One Lakh Sixty Thousand) only on condition that the said amount shall be paid back within one year with interest @ 4% per month. In the event of failure to pay the amount, the plaintiff-respondent shall be entitled to recover the principal and interest by selling the properties of the defendant-appellant. In this regard, an Agreement was drawn up in writing in presence of the witnesses. In accordance with the agreement, the defendant-appellant started paying a sum of Rs. 6,400/- towards interest every month till Sept/2007. Thereafter, he stopped paying the monthly interest and in spite of repeated requests, the defendant-appellant neither returned principal amount of Rs. 1,60,000/- nor the interest accrued after Sept/2007. Finding no other way, the plaintiff-respondent submitted a complaint before the Officer in-Charge, Thoubal Police Station and a case was registered for commission of offence u/s. 420/406/506/34 of I.P.C. However, before any action could be taken, the defendant obtained anticipatory bail. When the plaintiff found that there is no other way to recover of the money, he filed the suit for recovery of the sum of Rs. 3,20,000/- (Three Lakh Twenty Thousand) towards principal of Rs. 1,60,000/- and interest of Rs. 1,60,000.

2. The defendant-appellant filed written statement in the said suit. Though he admitted to have taken loan of Rs. 1,60,000/- from the plaintiff-respondent on condition that he would pay interest @ 4% per month, he denied to have a written agreement with the plaintiff-respondent. It was the further case of the defendant-appellant that he had not only paid interest but also Rs. 1,50,000/- towards principal and accordingly was only required to pay 10,000/- rupees to the plaintiff-respondent.

On the basis of the pleadings of the parties, the learned Civil Judge framed 5 (five) issues which are as follows:-

1. whether the plaintiff had lent a sum of Rs. 1,60,000/- (Rupees One Lakh and sixty thousand) only to the defendant payable within one year with interest at the rate of 4% per month under an agreement dt. 20.3.2007 or not?

2. whether the agreement dt. 20.3.2007 is a fabricated and manufactured one or not ?

3. whether the plaintiff has no right to charge interest more than 3% per month or not?

4. cause of action

5. Reliefs.

3. The plaintiff-respondent examined three witnesses including himself whereas the defendant-appellant examined himself as the sole witness. The agreement dated 20.3.2007 was exhibited as Ext-A/2. The learned Civil Judge accepted the case of the plaintiff that an agreement had been executed between the plaintiff-respondent and the defendant-appellant on 20.3.2007 wherein the defendant-appellant acknowledged receipt of Rs. 1,60,000/- from the plaintiff-respondent on condition that he would pay back the money with interest @ 4% per month. Referring to the oral evidence adduced, the learned Civil Judge held that the defendant-appellant had failed to pay any amount out of the principal and also failed to pay interest after Sept/2007. Accordingly, with the above finding, the learned Civil Judge passed the decree for recovery of Rs. 3,20,000/- from the defendant-appellant and further directed that on failure on the part of the defendant-appellant to pay the decreetal amount, he would be liable to pay interest @ 6% per annum.

4. Shri A. Golly, the learned counsel appearing for the appellant assailed the judgment of the learned Civil Judge basically on five grounds:

a- The defendant-appellant ha