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2025 Supreme(Online)(Mad) 62642
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Sathi Kumar Sukumara Kurup, J
Athiyappan – Appellant
Versus
Sankar – Respondent
Appeal Suit. No.542 of 2022|C.M.P.No.20251 of 2022
For the Appellants/Petitioners: Vignesh Venkat, Anu Ganesan
For the Respondents: N.Manoharan
Once the execution of a promissory note is admitted, a legal presumption of consideration arises. A defendant who raises inconsistent and destructive pleas at different stages of the trial fails to rebut this presumption, and the court is justified in drawing an adverse inference against them.
Headnote:(A) Negotiable Instruments Act - Sections 20, 87, 118 - Recovery of money - Suit on promissory note - Once execution of promissory note is admitted, legal presumption under S. 118 arises regarding consideration. The burden shifts to the defendant to rebut this by raising a probable defence; failing which, the presumption remains. A defendant cannot be allowed to take mutually contradictory or destructive pleas at different stages of the proceedings. (Paras 17, 19, 29, 30)
(B) Evidence Act - Section 101, 102, 103, 114(g) - Burden of proof - Parties in a civil suit must plead their specific defence in the written statement. Where a defendant fails to prove their pleadings and instead introduces inconsistent evidence, the court is justified in drawing an adverse inference against such conduct. (Paras 13, 37, 41)
(C) Civil Procedure Code - Order XLI, Rule 27 - Appellate stage - Additional evidence - Appellate courts should not permit the introduction of additional evidence simply to fill lacunae in a party’s case, particularly when the party was not diligent during the trial stage. (Paras 32, 38, 46)
Facts of the case:
The appellant unsuccessfully defended a suit for recovery of money based on a promissory note. The appellant argued that the instrument was obtained under different circumstances than those pleaded in the plaint and later denied his signature on the instrument entirely. The trial court decreed the suit, noting the shifting and contradictory nature of the defence.
Findings of Court:
The court held that the appellant failed to discharge the initial burden of proof required to rebut the presumption under the Negotiable Instruments Act. The various, inconsistent versions presented by the defendant undermined his credibility and justified the trial court's decision to draw an adverse inference.
Issues: Whether the trial court erred in its appreciation of evidence and failure to rebut the legal presumption of consideration attached to the promissory note, and whether the appellate stage is appropriate for the submission of additional evidence to challenge the authenticity of the signature.
Ratio Decidendi: Where a defendant makes prevaricative and inconsistent defences across the reply notice, written statement, and oral evidence, they fail to discharge the evidentiary burden. A party who has been negligent during the trial stage cannot be permitted to adduce additional evidence on appeal to rectify failures or introduce new, contradictory pleas.
Result: Appeal dismissed.
| Table of Content |
|---|
| 1. overview of the appeal regarding trial judgment on suit promissory note. (Para 1 , 2) |
| 2. application of section 118 ni act and rebuttal of presumptions. (Para 3 , 26 , 31) |
| 3. effect of prevaricative defences and abandonment of pleadings on evidence. (Para 4 , 5 , 20 , 21 , 22 , 23 , 35 , 41 , 43) |
| 4. non-disclosure of transaction in it returns as proof of illegality. (Para 15 , 40 , 42) |
| 5. limitations on admitting additional evidence in appeal under order xli rule 27 cpc. (Para 32 , 36 , 37 , 38 , 39 , 46) |
| 6. evaluation of trial court's appreciation of evidence and final order. (Para 44 , 45 , 47) |
J U D G M E N T
This First Appeal has been filed to set aside Judgment and Decree dated 23.02.2022 passed in O.S.No.26 of 2019 by the learned III Additional District and Sessions Judge, Kallakurichi.
2. The learned Counsel for the Appellant submitted that the Appellant is the Defendant in O.S.No.26 of 2019 on the file of the learned III Additional District and Sessions Judge, Villupuram at Kallakurichi. Before filing the Suit, the Plaintiff had issued pre-suit notice which was properly replied by the Defendant. It is the contention of the learned Counsel for the Appellant that the Defendant had executed a sale agreement in favour of the relative of the Plaintiff/wife. Subsequently, the sale agreement was cancelled and proper sale deed was executed. At that time, they had obtained signature from the Defendant. Based on which, the Suit promissory note had been put into use for filing this Suit. The Defendant had clearly denied having availed any loan on the alleged date. During trial, the learned Counsel for the Defendant had cross-examined the Plaintiff as P.W-1. In his evidence, P.W-1 had clearly admitted that he had not shown the amount lent to the Defendant as loan in his income tax returns. Further, it is the contention of the learned Counsel for the Appellant that in the course of the trial, P.W-2 and P.W-3 were examined who are attesting witnesses. They had stated that the promissory note was returned in the office of the document-writer nearby Taluk Office.
3. It is his further submission that the date mentioned in the Promissory Note is 30.10.2016 was a Sunday. Therefore, it is unbelievable to have executed a promissory note for a huge amount of Rs.10,00,000/- having been issued to the Defendant. In the course of the trial, the learned III Additional District and Sessions Judge, Villupuram at Kallakurichi rejected the defence of the Defendants stating that the reply to the pre-Suit notice he had stated a different defence. In the written statement he had stated different defence. In the evidence he had stated a very different defence. Therefore, the defence of the Defendants was rejected by the learned Judge and the Suit was decreed. The learned Counsel for the Appellant invited the attention of this Court to Section 43 of the Negotiable Instruments Act and placing reliance on the cross-examination of P.W-1 which itself creates doubt in the mind of the Court. For which he relied on the following decisions:-
(i) In the case of M.S.Narayana Menon Vs. State of Kerala and Ors. reported in MANU/SC/2881/2006, it has been observed as follows:-
“17. Applying the said definitions of 'proved' or 'disproved' to principle behind Section 118(a) of the Act,the Court shall presume a negotiable instrument to be for consideration unless and until after considering the matter before it, it either believes that the consideration does not exist or considers the non-existence of the consideration so probable that a prudent man ought, under the circumstances of the particular case, to act upon the supposition that the consideration does not exist. For rebutting such presumption, what is needed is to raise a probable defence. Even for the said purpose, the evidence adduced on behalf of the complainant could be relied upon.
18. A Division Bench of this Court in Bharat Barrel & Drum Manufacturing Company v. Amin Chand Payrelal [(1999) 3
