THE HON’BLE SMT. JUSTICE TIRUMALA DEVI EADA CITY CIVIL COURT APPEAL No.250 OF 2019

JUDGMENT:

This is an appeal filed by the appellant, being aggrieved by the judgment and decree, dated 13.12.2018 passed in O.S.No.126 of 2011 by the learned III Additional Chief Judge, City Civil Court at Hyderabad (for short “the trial Court”).

2. The appellant herein is the plaintiff and the respondents are the defendants before the trial Court. The parties herein are referred to as they were arrayed in the suit before the trial Court for the sake of convenience and clarity.

3. The case of the plaintiff before the trial Court is that it is a registered company under the Indian Companies Act doing chit fund business. That on 25.10.2008, the 1^st defendant joined as a member of the Chit Fund Scheme of the plaintiff company and was allotted ticket No.LT002DHN-21 and the total value of chit is Rs.25,00,000/- to be subscribed @ Rs.50,000/- per month for 50 months and signed an agreement of chit on 25.10.2008. In the auction conducted on 26.10.2008, the defendant stood as a successful bidder being agreed to forego Rs.10,00,000/- out of Rs.25,00,000/- and that was duly confirmed by the plaintiff company, after deducting the company’s commission from the foregone amount, the balance was distributed among all the members in the said series and as per the rules, the successful bidder has furnished independent guarantors to the satisfaction of the company for the due amount of entire future monthly instalments and then the 1^st defendant has paid Rs.15,00,000/- till the date of payment of prize amount and future liability stood as Rs.23,50,000/-. The said guarantors have executed an agreement on guarantee dated 29.11.2008 and they have also executed a promissory note dated 29.11.2008 towards the future installments. That the 1^st defendant committed default in paying installments from 15.05.2010 inspite of repeated demands made by the plaintiff company, the defendant failed to pay the dues. Thus, the plaintiff company has issued a legal notice, inspite of which the defendants failed to pay the same.

Hence, the suit.

4. Initially, defendant Nos.2 and 3 have filed written statement and the suit was decreed in 2014 vide judgment and decree dated 30.06.2014. Subsequently, the defendant No.1 has filed an I.A. to set aside the ex parte decree passed against him and the same was allowed and again he filed a written statement denying the averments of the plaintiff and denying his liability. However, he admitted to have entered into a chit agreement and admitted that he joined as a member of the chit fund scheme in the plaintiff company, having been allotted a ticket No.LT002DHN-21. He has also admitted the value of the chit and the rate of subscription but denied the extent of liability. It is the contention of the defendant that the plaintiff company foreman has obtained his signatures on blank paper by stating that it is a mere formality. He further admitted that he has paid an amount of Rs.15,00,000/- till the date of prize amount but he denied that he is liable to pay Rs.15,54,983/-. He denied all the other averments made in the plaint. The defendant has further submitted that his business is running into losses and that the defendant is the sole bread winner of the family and therefore, if the Court comes to an conclusion by decreeing the suit, then he may be allowed to pay the due amount in monthly installments @ Rs.10,000/- by waiving the interest amount as claimed by the plaintiff company.

5. Based on the above pleadings, the trial Court has framed the following issues for trial:

“1. Whether the plaintiff is entitled for the suit amount from the defendants and if so to what extent?

2. To what relief?”

6. The following additional issues are framed on 08.11.2017:

“1. Whether the defendant discharged part of the suit amount?

2. To what relief?”

7. At the time of trial, plaintiff got examined PW1 and got marked Exs.A1 to A19 and the defendants have not adduced any eviden