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2025 Supreme(Online)(Mad) 64056
IN THE HIGH COURT OF JUDICATURE AT MADRAS
P.VELMURUGAN, J
Amirtham Ammal – Appellant
Versus
Sundaravalli – Respondent
Second Appeal | S.A.No.1159 of 2000
For the Appellant in S.A.No.1159 of 2000: Mr.K.Govindarajan
For R1 to R3 in S.A.No.1159 of 2000: Notice Served & No appearance
For R5 in S.A.No.1159 of 2000: Mr.T.M.Hariharan
For R6 in S.A.No.1159 of 2000: Mr.R.Murali
Burden of proof in negotiable instruments lies on the signer to refute legal presumptions of validity.
Headnote:(A) Negotiable Instruments Act, 1881 - Section 118 - Promissory note execution - Presumption of consideration arising under Section 118 was upheld by the lower appellate court, rejecting the appellant's defense of coercion and misrepresentation - The appellant admitted the signature on the promissory notes and receipt of loan, thereby shifting the burden to rebut the presumption - The trial court's dismissal was overturned based on the legal presumption and relationship dynamics. (Paras 12, 14, 17, 19)
(B) Second Appeal - Scope of Review - The appellate court assessed the evidentiary value and correctly applied legal presumptions, thus finding the lower appellate court’s judgment sustainable within the established facts of the case. (Paras 18, 19)
| Table of Content |
|---|
| 1. factual background of the dispute over loan agreements. (Para 1 , 2 , 3 , 4) |
| 2. arguments presented by both parties regarding the execution of promissory notes. (Para 8 , 9 , 10) |
| 3. court observations on the presumption of validity of negotiable instruments. (Para 12 , 13 , 17) |
| 4. court's rationale for upholding the lower appellate court's judgment. (Para 14) |
| 5. final ruling of the second appeal. (Para 19) |
JUDGEMENT
S.A.No.1159 of 2000 has been filed against the judgment and decree dated 31.7.1997 made in A.S.No.194 of 1996 on the file of the Second Additional District Court, Tiruchirapalli, reversing the judgment and decree dated 20.8.1996 made in O.S.No.156 of 1995 on the file of the Subordinate Court, Kulithalai.
2. One Mr.Paramasivam and four others filed a suit in O.S.No.156 of 1995 before the Subordinate Court, Kulithalai as against one Mrs.Amirtham Ammal seeking for recovery of a sum of Rs.59,500/- together with future interest. During the pendency of the suit, the original plaintiff died and his legal heirs were brought on record. After contest, the trial Court, vide judgment dated 20.8.1996, dismissed the suit filed by the plaintiffs. Aggrieved by the same, plaintiffs 2 to 5 preferred A.S.No.194 of 1996 before the Lower Appellate Court/ The Second Additional District Court, Tiruchirapalli,, vide judgment dated 31.7.1997, set aside the judgment and decree passed by the trial Court and allowed the appeal filed by plaintiffs 2 to 5. Against the judgment and decree of the Lower Appellate Court, the sole defendant has filed this Second Appeal before this Court.
3. The averments as contained in the plaint in O.S.No.156 of 1995 are as follows:
(i) The defendant (Ms.Amirtham Ammal) is none other than the elder sister of the original plaintiff and the daughter of the fifth plaintiff (Mrs.Nagarathinam Ammal). The defendant had approached the fifth plaintiff for the purpose of purchasing a house-site and for constructing a house, she had requested a loan amount of Rs.1,15,000/-. Pursuant to that, the defendant had borrowed Rs.50,000/- from the said Mrs.Nagarathinam Ammal and had executed a promissory note on 16.1.1993, agreeing to repay the said loan amount with interest at 2% per month. The defendant had also borrowed another sum of Rs.65,000/- from the said Mrs.Nagarathinam Ammal and had executed another promissory note on 16.1.1993, agreeing to repay the said loan amount with interest at 2% per month.
(ii) Subsequently, the said Mrs.Nagarathinam Ammal had assigned the same to the original plaintiff on 10.8.1993. Hence, the sole defendant was liable to pay the amounts mentioned in the promissory notes to the plaintiffs. Despite repeated demands made by the plaintiffs, both personally and through a lawyer's notice dated 26.10.1993, the defendant had failed to repay the loan amounts. Hence, the original plaintiff had filed the suit claiming a sum of Rs.59,500/- together with future interest.
4. The sole defendant filed a written statement, wherein it has been stated as follows:
(i) The defendant denied that she had approached the said Mrs.Nagarathinam Ammal for a loan amount of Rs.1,15,000/- to construct a house. The defendant had also denied the averment that she borrowed the said amount from the said Mrs.Nagarathinam Ammal and executed two promissory notes on 16.1.1993, agreeing to pay interest at 2% per annum.
(ii) The defendant had also denied the averment that said Mrs.Nagarathinam Ammal received the principal and interest amounts from the original plaintiff as mentioned in the promissory notes and assigned the same to the original plaintiff. The defendant had neither executed any promissory notes nor borrowed any amount from the said Mrs.Nagarathinam Ammal. There had been no necessity for the defendant to borrow any amount.
(iii) The defendant married a person named Mr. Murugan in 1976, which was an inter-caste marriage. The father of the defendant and the original plaintiff, Mr. Raju Pillai, had obtained certain prop
