JUDGMENT

C.S.Sudha, J.

This appeal is against the judgment and decree dated

10.02.2012 in O.S.No.874/2010 on the file of the Sub Court, Ernakulam. The suit is one for money based on a cheque. By the impugned judgment, the suit has been dismissed. Hence, the plaintiff is before this Court with this appeal. The respondent herein is the sole defendant in the suit. The parties in this appeal will be referred to as described in the plaint.

2. The plaint was filed alleging thus- The plaintiff and defendant, both natives of Kerala, are doing various businesses in Dubai, UAE. They are close associates. In February 2006, the defendant purchased the scheduled properties in which he proposed to start a joint venture business with the plaintiff for developing the properties into a “Farm House-Tourism Spot”. The estimated cost for the completion of the project was two crore rupees. As requested by the defendant, the plaintiff agreed to invest 50% of the estimated cost of the project in instalments within a period of five years. Accordingly, he paid a total amount of Rs.2,85,00,4000/- in instalments, as cash as well as through the bank account of PW2, a friend of the defendant, who in turn handed over the money to the latter. Later on, realizing that the project was not going to materialize due to the inability/failure of the defendant to contribute his share in the business, the plaintiff demanded the money back. The defendant agreed to repay the money and issued Exts.B1 and B2 cheques dated 25.09.2009 drawn on Dhanalakshmi Bank, for an amount of Rs.1,42,50,000/- each. However, the cheques on presentation were dishonoured due to insufficiency of funds in the account of the accused. When the defendant was informed of the dishonour, he sought time for repayment and thereafter issued Ext.A1 cheque dated 05.05.2010 drawn on Dhanalakshmi Bank, Palarivattom branch, Ernakulam for an amount of Rs.3,25,00,000/-. Ext.A1 cheque when presented was also dishonoured due to insufficiency of funds in the account of the accused. Hence, the plaintiff issued Ext.A3 notice dated 31.08.2010 informing the defendant of the dishonour, to which the defendant sent Ext.A6 reply notice dated 16.09.2010 denying the liability and raising false and untenable contentions. Hence the plaintiff moved the suit for realization of an amount of Rs.3,25,00,000/- along with interest at the rate of 18% percent annum.

3. The defendant filed written statement denying the plaint transaction. According to him, no amount as alleged in the plaint was ever received by him. There was no joint business project as claimed by the plaintiff. On the other hand, Exts.B1, B2 and A1 cheques were issued as security in the business transaction between the parties. According to the defendant, the plaintiff is the General Manager of M/s. Golden Arrow Interiors LLC, Sharjah, UAE and is also an agent of M/s. Build Tech Middle East LLC, Sharjah, UAE. These companies are engaged in the business of building materials. The defendant is the Managing Director of M/s. Dortech Middle East LLC, which is running a business in the supply of hardware for doors. The plaintiff as an agent of the aforesaid companies used to place orders for supply of goods from the defendant. The supply of goods was placed to M/s. Dortech Middle East LLC through the plaintiff acting as the agent of the aforesaid companies. The defendant had issued the cheques referred to in the plaint as security for the time bound performance and quality of materials supplied. These cheques were only intended as a security against any loss the plaintiff might suffer due to any fault on the part of the defendant. Exts.B1 and B2 cheques are two among such cheques that were returned by the plaintiff to the defendant on completion of supply of goods as per the earlier work orders. The security cheques would be returned as and when the supply orders are successfully fulfilled by the defendant. Fresh cheques would then be issued for fresh orders, which wo