A material inconsistency in the testimony of the plaintiff regarding the loan amount cannot be dismissed as a stray admission and is sufficient to rebut the presumption under Section 118 of the Negotiable Instruments Act.

THIS RSA IS FILED UNDER SEC.100 OF CPC., AGAINST THE JUDGMENT AND DECREE DATED 01.12.2023 PASSED IN RA NO. 12/2022 ON THE FILE OF PRINCIPAL SENIOR CIVIL JUDGE AND JMFC, HUNSUR, ALLOWING THE APPEAL AND SETTING ASIDE THE JUDGMENT AND DECREE DATED 22.04.2022 PASSED IN OS NO.188/2018 ON THE FILE OF ADDITIONAL CIVIL JUDGE AND JMFC, HUNSUR.

THIS APPEAL HAVING BEEN HEARD AND RESERVED FOR JUDGMENT ON 12.02.2026, THIS DAY, THE COURT PRONOUNCED THE FOLLOWING:

CAV JUDGMENT

Challenging judgment and decree dated 01.12.2023 passed by Principal Senior Civil Judge and JMFC, Hunsur, allowing RA no.12/2022 by setting aside judgment and decree dated 22.04.2022 passed by Additional Civil Judge and JMFC, Hunsur, in OS no.188/2018, this appeal is filed.

2. Though, matter was listed for admission, since records were received and both learned counsel expressed to argue for final disposal on proposed substantial questions of law, matter was heard affording opportunity.

3. Sri YV Prakash, learned counsel appearing for Sri YK Narayana Sharma, advocate for appellant submitted, appeal was by plaintiff in OS no.188/2018 filed seeking recovery of Rs.4,19,150/- along with monthly interest at rate of 1.50% from date of filing of suit till date of realization etc.

4. In plaint, it was stated, on 16.05.2016, defendant borrowed Rs.3,00,000/- from plaintiff for personal need agreeing to repay with monthly interest at 1.5% and executed a promissory note and receipt of amount, in presence of witnesses. However, he failed to repay even after repeated demands and receipt of legal notice dated 11.06.2018 got issued by plaintiff, leading to filing of suit.

5. On appearance, defendant filed written statement denying plaint averments in toto. Specifically denying loan transaction, it was contended, plaintiff's wife Shailaja was running unauthorized chit fund without permission and for said purposes, obtained signed blank promissory note as 'security', when defendant subscribed to a chit for Rs.2,00,000/- in 2015. He claimed to have paid monthly installments of Rs.10,000/-, when dispute arose about accounts. And though he did not pay last two installments due to financial difficulty, he was ready to pay them and repeatedly asked for return of promissory note. Claiming to have lost it, plaintiff had misused it for filing false suit and prayed for its dismissal.

6. Based on pleadings, trial Court framed following:

ISSUES

1. Whether the plaintiff proves that the defendant for his legal necessity borrowed a sum of Rs.3,00,000/- by executing on demand promissory note along with consideration receipt on 16.05.2016 and has agreed to repay the loan amount with interest at 1.50% per annum?

2. Whether the plaintiff further proves that despite of repeated requests and demand the defendant failed to repay the loan amount?

3. Whether the defendant proves his contentions at para no.7 to 9 of his written statement?

4. Whether plaintiff is entitled for recovery of sum of Rs.4,19,150/- with future interest at rate of 1.50% per month from the defendant from the date of filing of suit till realization?

5. What order or decree?

7. In trial, plaintiff examined himself and two others as PWs.1 to 3 and got marked Exhibits P1 to P6; while, defendant examined himself and another as DWs.1 and 2 and got marked Exhibits D1 to D3.

8. On consideration, trial Court answered issues no.1 and 2 in affirmative; issue no.3 in negative, issue no.4 partly in affirmative and issue no.5 by decreeing suit.