Written agreements supersede inconsistent oral testimony. Under the Indian Evidence Act, oral evidence is inadmissible to contradict, vary, or subtract from the terms of a contract reduced to writing, and acts of part-performance serve to validate the voluntariness of entered settlements.

Headnote:(A) Civil Procedure Code, 1908 - Section 100 - Indian Evidence Act, 1872 - Sections 91 and 92 - Indian Contract Act, 1872 - Section 10 - Recovery of money - Loan agreement - Settlement - Appellate courts should not disregard written instruments in favor of oral testimony - Written contracts duly signed and partially acted upon are binding unless vitiated by clear proof of fraud or duress - Allegations of coercion without supporting particulars are insufficient to avoid contractual obligations. (Paras 34, 51, 57, 58)

(B) Evidence - Admissibility - Oral evidence contrary to written document - Prohibited under Sections 91 and 92 of Indian Evidence Act - Parties cannot lead evidence to contradict, vary, or subtract from terms of reduced-to-writing agreements - Final and deliberate expression of intent. (Paras 57, 58)

(C) Contract - Free consent - Coercion - Burden of proof lies on the party asserting invalidity - Conduct of parties, such as part performance of agreed installments, serves as evidence against claims of involuntariness or lack of free will. (Paras 51, 54)

Facts of the case:
The plaintiff filed a suit for recovery of a loan which was subsequently incorporated into a written settlement agreement. The defendant contended that the loan amount was lower and the settlement was involuntary. While the trial and appellate courts dismissed the suit due to perceived inconsistencies in oral testimony and the validity of the settlement, the plaintiff appealed.

Findings of Court:
The lower courts erred by failing to accord primacy to the written settlement agreement and by ignoring the defendant's acts of part-performance, which contradicted the claims of coercion.

Issues: The main issues were the admissibility of oral evidence to contradict written agreements and whether partial performance of a contract precludes a later plea of involuntariness or coercion.

Ratio Decidendi: Written instruments constitute the final and deliberate expression of the parties' intentions, take precedence over oral testimony per the Evidence Act, and are binding when a party has acted upon the terms before alleging coercion.

Result: Appeal allowed; suit of the plaintiff decreed.

Table of Content
1. establishing the factual matrix and evidentiary trail of the loan transaction. (Para 1 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 20 , 21 , 22 , 23 , 24 , 25)
2. application of sections 91-92 evidence act: written documents override oral testimony. (Para 2 , 51 , 52 , 53 , 54 , 57 , 58 , 61)
3. defendant asserts coercion and challenges the legitimacy of the loan agreement. (Para 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19)
4. evidence re-appreciation and the enforceability of written settlement contracts. (Para 26 , 27 , 28 , 29 , 30 , 31 , 32 , 39 , 40 , 41 , 42 , 43 , 44 , 45 , 46 , 47 , 48 , 49 , 50 , 55 , 56 , 59 , 60)
5. appellate grounds regarding the binding nature of written settlement agreements. (Para 33 , 34 , 35 , 36 , 37 , 38)
6. final quantification of relief and disposal of the appeal. (Para 62 , 63 , 64 , 65)

J U D G M E N T

NEENA BANSAL KRISHNA, J.

1. Second Regular Appeal under Section 100 of the Code of Civil Procedure, 1908 (hereinafter referred to ‘CPC‟) has been filed on behalf of the Appellant against the Judgment dated 14.05.2024, whereby the learned District Judge-06, Central District, Delhi in RCA DJ No. 16/2019, has upheld the Judgment and Decree dated 18.12.2018 of the learned Civil Judge whereby the Suit of the Plaintiff for Recovery of Rs.2,84,500/-, has been dismissed.

2. The Substantial question of Law that arises in the present Appeal is:

(i) Whether the oral evidence is admissible in the teeth of Written Document?

(ii) Whether findings on oral evidence, in contradiction to written document, is contrary to S.90/S.91 Indian Evidence Act?

3. The Plaintiff/Appellant had filed a Suit for Recovery of Rs.2,84,500/- along with the pendente lite and future interest @18% p.a. against Defendant.

4. The facts in brief, are that the Plaintiff and the Defendant were well known to each other, having previously been residents of Sita Ram Bazar, Delhi. The Defendant took a loan of Rs.3,20,000/- on 15.09.2013, stating that he was under financial stress as he had purchased a house in August, 2011 and had also got his son married. The Defendant promised to pay in a year‟s time and he also promised to pay interest @18% p.a.

5. The Defendant failed to pay the loan amount and when the Plaintiff insisted, he issued a cheque dated 21.10.2014 for Rs.3,20,000/- in favour of the Plaintiff, with an assurance that on presentation, the cheque would be encashed.

6. The cheque, however on presentation for encashment on 16.01.2015, was dishonoured with the remarks “Accounts Closed”, vide Return Memo dated 19.01.2015. The Plaintiff immediately approached the Defendant for the return of loan and also served a demand Notice dated 18.02.2015 asking the Defendant to repay the loan amount.

7. With the intervention of common friends, the dispute was amicably settled, and the Defendant agreed to pay a sum of ₹1,10,000/- in lieu of the cheque, in instalments. The first instalment of ₹10,000/- was payable on 25.03.2015, and subsequent instalments of an equal amount, were to be paid on a monthly basis, commencing from 01.05.2015.

8. The parties entered into a Settlement dated 16.03.2015, in the presence of witnesses. Clause 4 of the said Settlement provided that, in the event of the Defendant‟s failure to pay two consecutive instalments, the Plaintiff would be at liberty to claim the entire loan amount of ₹3,20,000/-. The Defendant paid five instalments of ₹10,000/- each from 25.03.2015 till August 2015, and one further instalment on 05.10.2015, thereby paying a total sum of ₹60,000/-. However, the Defendant failed to pay any instalments from October, 2015 onwards and thus, failed to honour the Settlement dated 16.03.2015.

9. In view of the Defendant‟s default, the Plaintiff became entitled to recover the entire loan amount of ₹3,20,000/- along with interest. However, after adjusting the sum of ₹60,000/- already received, the Plaintiff was entitled to balance amount of ₹2,60,000/- along with interest @18% per annum.

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2026 Supreme(Online)(Del) 6428

IN THE HIGH COURT OF DELHI AT NEW DELHINeena Bansal Krishna, JKishan Kumar Gupta – AppellantVersusRaj Kumar – RespondentRSA 150/2024 | CM APPL. 47257/2024

Written agreements supersede inconsistent oral testimony. Under the Indian Evidence Act, oral evidence is inadmissible to contradict, vary, or subtract from the terms of a contract reduced to writing, and acts of part-performance serve to validate the voluntariness of entered settlements.

Cases Referred (5)

IN THE HIGH COURT OF DELHI AT NEW DELHI
Neena Bansal Krishna, J
Kishan Kumar Gupta – Appellant
Versus
Raj Kumar – Respondent
RSA 150/2024 | CM APPL. 47257/2024