2024 Supreme(Online)(KER) 15811
HIGH COURT OF KERALA
M.A. ABDUL HAKHIM, J
SHIJU GEORGE – Appellant
Versus
T.V. GEORGE – Respondent
RSA 210/2023
T.G.RAJENDRAN, T.R.TARIN, A.S.BENOY, C.Y.VINOD KUMAR(K/652/2008), C.ANILKUMAR (KALLESSERIL)(A-455)
The defendant must provide evidence to prove discharge of liability in a cheque dishonor case under the Negotiable Instruments Act.
Headnote:
[Cheque] - [Recovery of Money] - [Negotiable Instruments Act, 1881 - Section 138] - [The court interpreted Section 138 of the Negotiable Instruments Act, emphasizing the burden of proof on the defendant to establish discharge of liability. The absence of evidence for payment led to the dismissal of the appeal.]
Fact of the Case:
The plaintiff sued the defendant for recovery of Rs.10,00,000/- plus interest, claiming the defendant issued a cheque that was dishonored. The defendant admitted the loan but claimed to have repaid part of it without obtaining a receipt.
Finding of the Court:
The court found that the defendant failed to prove the discharge of liability, as there was no evidence that the alleged payment of Rs.11,00,000/- was made to the plaintiff.
Issues: Whether the defendant discharged the liability by proving payment of Rs.11,00,000/- to the plaintiff.
Ratio Decidendi: The burden of proof lies on the defendant to establish a discharge of liability, which was not met in this case.
Final Decision: The appeal was dismissed, affirming the trial court's decision.
The defendant in a suit for recovery of money is the appellant. The parties are referred according to their status before the trial Court.
2.The plaintiff filed the suit for realisation of Rs.10,00,000/- along with Rs.28,480/- as interest accrued from 15.06.2019 to 04.09.2019 on the averments that, the defendant approached the plaintiff for money and obtained a hand loan of Rs.10,00,000/-; that the plaintiff paid the amount by two cheques of Rs.5,00,000/- each dated 26.09.2017 and 23.10.2017 of the Federal Bank Sulthan Bathery branch; that the defendant issued Ext.A1 cheque dated 15.06.2019 for Rs.10,00,000/- towards the discharge of the liability; that when the plaintiff presented the cheque for collection, the same was returned unpaid with a Memo of stating funds insufficient; that when Notice was issued by the plaintiff to the defendant intimating the dishonour of the cheque and demanding the amount it evoked no result and hence the suit is filed.
3.The defendant filed a Written Statement admitting the liability by receipt of the amount as per the aforesaid two cheques and contending that Ext.A1 cheque was issued as a security; that the understanding between the plaintiff and the defendant was that, Rs.50,000/- per month as interest would be paid; that the defendant could not clear the liability within 30.04.2018 as agreed and hence requested for time; that later, on 26.06.2018 the defendant had withdrawn Rs.11,00,000/- (Rupees Eleven Lakhs only) from the OD account of ‘Day Dream Resort’, a partnership of the defendant and DW2 and handed over the same to the plaintiff in front of the bank. The plaintiff was examined as PW1 and marked Ext.A1 to A5. The defendant was examined as DW1 and Sri.Arun Kumar.P.T who is the partner of the defendant was examined as DW2 and marked Ext.B1.
4.The Trial Court decreed the suit with costs ordering the defendant pay Rs.10,28,480/- to the plaintiff with interest @ 6% per annum till realisation. The First Appellate Court dismissed the Appeal filed by the defendant confirming the judgment and decree passed by the Trial Court.
5.I heard the learned counsel for the appellant and the learned counsel for the respondent.
6.The learned counsel for the appellant submitted that, the evidence of DW2 and Ext.B1 Statement of Accounts would prove that an amount of Rs.11,00,000/- was withdrawn from the account of the partnership in which the defendant was a partner.
It probabalize the case of the defendant that, he has paid Rs.11,00,000/- to the plaintiff on 26.06.2018. He submitted that, since the parties were in cordial terms the defendant could not obtain any receipt for the same and the plaintiff assured that the security cheque would be returned.
7.On the other hand, the learned counsel for the respondent submitted that, there is no proof that the amount of Rs.11,00,000/- withdrawn on 26.06.2018 is paid to the plaintiff.
The said amount might have been withdrawn for the business purpose of the partnership firm and the defendant is trying to make a false defence on the basis of the same.
8.On going through the impugned judgments, I find that the defence of the defendant is a plea of discharge. If the defendant has made plea of discharge, the burden is on the defendant to discharge such burden. Here as rightly contended by the learned counsel for the respondent that, there is no evidence to indicate that the amount of Rs.11,00,000/- withdrawn from the account of the partnership on 26.06.2018 was paid to the plaintiff. The evidence of DW2 could not be relied on since he is the close associate of the defendant. The defendant is a partner of a firm by name Day Dream Resort and he fully knows the need for obtaining receipt for payment of money. If he had paid the aforesaid amount of Rs.11,00,000/- to the plaintiff, he should have obtained proper Receipt for the same. There is no reasonable explanation for not obtaining the receipt for such payment. Since, the liability is admitted by the defendant and the de