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Kerala High Court · body

1970 DIGILAW 160 (KER)

CHELLAMMA v. PADMANABHAN NAIR

1970-08-18

E.K.MOIDU

body1970
Judgment :- 1. The plaintiff, whose suit on the strength of a promissory note having been dismissed by the lower court as a result of a finding that the promissory note was materially altered without the knowledge of the executant-respondent, has come up in revision. 2. Ext. P1 dated 27 71965 is the plaint promissory note executed by the respondent to the revision petitioner for a sum of Rs. 325/ The respondent admitted the execution of Ext. P1, but he contended that it was not supported by consideration and that it was materially altered by the revision petitioner without his knowledge. The court below found that Ext. P1 was supported by consideration, but on the next question, the finding was that it was materially altered. 3. The material alteration is sought to be established on account of the affixture of 2 revenue stamps of 5 Paise denomination each to the promissory note after its execution. Ext. P1 now contained 3 revenue stamps, one of 10 Paise and two of 5 pasie each. 10 pasie stamp is found affixed on the right-hand side of Ext P1 and 2 five paise stamps on the left-hand side of Ext. P1. The case of the respondent is that the two revenue stamps of 5 paise each affixed on the left hand side of Ext. P1 was a later insertion by the revision petitioner without his knowledge. The respondent was examined as Dw2 and the attestor to Ext. P1 was examined as Dw1. The evidence of both Dws 1 and 2 was that when Ext. P1 was executed, there was no revenue stamp affixed on the left-hand side of Ext. P1 and that it was a later insertion. The revision petitioner was examined as Pwl. His evidence was that all the stamps had been affixed at the time of the execution. There are certain striking circumstances to show that the 2 revenue stamps affixed on the left-hand side of the promissory note were later insertion. It is true that the respondent in his written statement did not state specifically that any new stamps had been affixed to the promissory note after its execution. But it is alleged that there had been material alteration in the promissory note and on the basis of that promissory note the revision petitioner could not enforce his claim. The 10 paise stamp affixed on the right hand side of Ext. But it is alleged that there had been material alteration in the promissory note and on the basis of that promissory note the revision petitioner could not enforce his claim. The 10 paise stamp affixed on the right hand side of Ext. P1 was admittedly cancelled by the respondent with his signature and data. But, the five paise stamps on Ext. P1 were seen cancelled only with date. That cancellation with the date on the 5 paise stamps on Ext. P1 appears to be in a different ink and the colour of the two stamps alleged to have been affixed subsequently is also different from the colour of one 10 paise stamp, which was originally affixed on the Ext. P1. The two stamps affixed later were the old Travancore Stamps with the labels of T. C., printed on it while the original 10 paise stamp is a Kerala Revenue Stamp. On a scrutiny of the impugned stamps, it is clear that they were pasted with a different gum with some stains spread over the stamps. Scrutinising the document, I feel satisfied that these two stamps of 5 paise denomination each were affixed subsequent to the date of the execution of the promissory note. If there is prima facie evidence on a promissory note itself that there was alteration, the onus is on the revision petitioner, who is the plaintiff, to prove that the instrument was altered before it was executed and delivered. The cancellation of the two disputed stamps in a different ink and the difference in the colour of the stamps and other circumstances are sufficient materials to compel me to come to the conclusion that Ext. P1 was altered subsequent to its execution. The observation of the court below is also to the same effect. I find accordingly that Ext. P1 was materially altered after its execution. 4. It has to be admitted that affixture of additional stamps subsequent to the execution of the promissory note without the knowledge of the executant in order to make it an enforceable instrument in a court of law is a material alteration falling within the mischief of and hit by S.87 of the Negotiable Instruments Act, 1831. This is the dictum, which was in Srinivasan Pillai v. Kanniappa Pillai (71 Law Weekly 398). This is the dictum, which was in Srinivasan Pillai v. Kanniappa Pillai (71 Law Weekly 398). The above decision was followed in Baanwarlal v. Gulab Chand (AIR 1959 Rajasthan 96) which is a case where additional stamps were affixed to a promissory note insufficiently stamped and held that the affixing of the additional stamps rendered the instrument invalid against the person so altering the same. Our High Court has followed this proposition in Achuthan Raghavan v. Varkey Vuriathu (1962 KLT 518), Sankara Paliai Usman Settu (1963 KLT. 241), & Thomman v. Usamiakhan (1967 KLT. 74). There is, therefore, no difficulty in accepting the above dictum for holding that affixture of additional stamps subsequent to the execution of the promissory note without the knowledge of the executant in order to make it an enforceable instrument in a court of law is a material alteration falling within the mischief of and hit by S.87 of the Negotiable Instruments Act, 5. I may assume for the purpose of this case that Ext. P1 promissory note was supported by consideration. That is the finding by the court below. There is no sufficient ground to interfere with that finding. If Ext. P1 was supported by consideration, the next question argued before me is that the revision petitioner is entitled to amend the plaint so as to bind the respondent to a decree on the basis of an original cause of action, which, according to the revision petitioner, is based on an earlier promissory note alleged to have been executed by the respondent to him. The question therefore is whether the revision petitioner is entitled to such a remedy in this case. I may, in this connection, point out that in similar circumstances, this court had occasion to consider whether a plaintiff should be allowed to fall back upon the consideration enumerated in the document and permit him to amend the plaint. Both in Achuthan Raghavan v. Varkey Variathu (1962 KLT. 518) and Sankara Pillai v. Usman Settu (1963 KLT 241), such an opportunity was not given to the party, who was found to have made material alteration in the promissory note. Velu Pillai, J. in Achuthan Raghavan v. Varkey Variathu (1962 KLT 518) had occasion to consider two decisions, one reported in Chimanlal v. Saviji Bechar (AIR 1955 Sourashtra 74) and the other in Lakshmi Narain v. Mt Anarna Den (AIR 1953 Allahabad 536). Velu Pillai, J. in Achuthan Raghavan v. Varkey Variathu (1962 KLT 518) had occasion to consider two decisions, one reported in Chimanlal v. Saviji Bechar (AIR 1955 Sourashtra 74) and the other in Lakshmi Narain v. Mt Anarna Den (AIR 1953 Allahabad 536). The learned judge distinguished those two cases and held "that the intention of the parties was to treat the promissory note and the loan for which it was executed as distinct and separate from each other. Therefore, it was held that where there was no suit on the original cause of action and no such claim was sought to be enforced, the plaintiff shall not be given a right to amend the plaint. However, in the circumstances of the present case, I feel that the revision petitioner shall not be allowed to amend the plaint. 6. The learned counsel has brought to my notice a decision reported in Thomman v. Usamiakhan (1967 K. L. T. 74). That was also a case, where the negotiable instrument was materially altered by the plaintiff in that suit. But, in that case, in the appeal memorandum, an amendment of the plaint was sought for on the basis of the original consideration. The plaintiff had also filed a separate application before the appellate court for amending the plaint. Taking into consideration those circumstances, the learned judge found that an opportunity shall be given to the plaintiff in that suit to amend the plaint on the basis of the original consideration. But, it could not be ascertained correctly from the decision whether the original consideration was part and parcel of the same transaction as the promissory note or whether the consideration sought to be enforced was based upon a payment anterior to the promissory note. Anyway, to my mind, the amendment could be given only if it is established that the consideration to the promissory note was made anterior to the promissory note and not the consideration which was simultaneous to the execution of the promissory note. In this regard, I may point out a decision reported in Narayanaprasad v. Ghanshamlal (AIR. 1951 Madhya Pradesh 62), where it is held that it is open to the plaintiff to fall back upon the original consideration of the promissory note only when the passing of the consideration and the execution of the promissory note are independent transactions. In this regard, I may point out a decision reported in Narayanaprasad v. Ghanshamlal (AIR. 1951 Madhya Pradesh 62), where it is held that it is open to the plaintiff to fall back upon the original consideration of the promissory note only when the passing of the consideration and the execution of the promissory note are independent transactions. But, where the passing of consideration and the execution of the promissory note was simultaneous, it would be hit by the provisions of S.91 of the Evidence Act which prohibits any evidence to prove the passing of the consideration. In such cases, it was pointed out that the amount advanced could not be recovered. The observation in that decision in Para.16 is as follows: "We may point out that the principle laid down in those two decisions has application only where the passing of the consideration and the execution of the pro-note are independent transactions. In Rangaswami Reddi v. K. Doraisami Reddi (AIR. 1957 Mad 715) it was held that where the passing of consideration and the execution of the pro-note was simultaneous, S.91 of the Evidence Act barred any evidence to prove the passing of the consideration. Accordingly, it was held that the amount advanced could not be recovered in such a case." 7. This view is more or less the same as the one which is the subject-matter of Rangaswami Reddi v. K. Doraiswami Reddi (AIR. 1957 Madras 715). Rajamannar, C. J., expressed the following opinion on this aspect of the question as follows: "Under S.87, a negotiable instrument which has been altered by the payee cannot be enforced by him. If the sum was lent earlier and the promissory note subsequently executed was only an acknowledgment of the loan and security for it. it may well be that the plaintiff would obtain a decree on that loan in spite of the subsequent promissory note becoming unenforceable. But where the Court found that the passing of consideration and the execution of the promissory note was simultaneous, S.91 Evidence Act would be an obvious bar to the admission of any evidence aliunde to prove the passing of consideration under the promissory note. In such circumstances, S.65 Contract Act cannot have any application: for, when an instrument which embodies a contract becomes unenforceable for some reason or other, it is not correct to say that the contract itself has become void. In such circumstances, S.65 Contract Act cannot have any application: for, when an instrument which embodies a contract becomes unenforceable for some reason or other, it is not correct to say that the contract itself has become void. Of course, there is no question of the agreement being discovered to be void. The contract between the parties is that in consideration of the money advanced by the creditor to the debtor, the debtor agrees to repay the said sum with interest thereon on demand. That contract as such has not become void. What has become void is the instrument containing the terms of the contract. The difficulty in the way of plaintiff is the rule of law, namely S.91 of the Evidence Act. The promise to repay the amount of the loan is certainly a term, indeed an essential term, of the contract. And if there was a completed contract which existed before the execution of the promissory note, an action would lie on such a contract eventhough the promissory note executed subsequently cannot be admitted in evidence for any reason. But where the promissory note had become void on account of material alteration and the Court found passing of consideration and the execution of promissory note simultaneous, provisions of S.65 Contract Act cannot be invoked." 8. Taking into consideration the facts of the instant case, I am of the opinion that the claim of the revision petitioner falls within the mischief of the above decision. Both in Ext. P1 and the plaint, he had a definite case that cash consideration was paid to the respondent on the date of Ext. P1. But, the learned counsel of the revision petitioner has brought to my notice a decision reported in S. Kunjan Pillai v. Peirce Leslie & Co. (1957 KLT. 521) to the effect that the word which is stated both in Ext. P1 and the plaint, would ordinarily be meant "for consideration had and received" and as such the revision petitioner's case that Ext. P1 was executed on the basis of an earlier transaction has to be accepted. It is true that Pw.1 in his evidence stated that there was a prior promissory note executed by the respondent to him. But, he stated that he handed over that promissory note to the respondent himself when Ext. P1 was executed. P1 was executed on the basis of an earlier transaction has to be accepted. It is true that Pw.1 in his evidence stated that there was a prior promissory note executed by the respondent to him. But, he stated that he handed over that promissory note to the respondent himself when Ext. P1 was executed. There was no circumstance to show that there had been any such exchange of promissory notes on the date of Ext. P1. When the recital in Ext. P1 as well as in the plaint is to the effect that cash had passed between the parties, it would be possible for the plaintiff to establish by evidence that at some previous stage cash had been paid to the opposite side under another pronote. But it would not be in consonance of justice and fair-play to take into account such evidence in the present case, which is based purely on cash consideration between the parties. I am not satisfied that the assertion made by Pw.1 that the respondent had on a previous occasion executed a promissory note in respect of the same transaction was true in the circumstance of the case. The evidence of Pw.1 in that regard, cannot be accepted without some other reliable material. So, the only conclusion possible, in the circumstances of the case, is that the pleading in the case is the basis for his claim. In that way, I find that the consideration was paid on the date of Ext. P1. In view of that conclusion, I hold that the revision petitioner, is not entitled to fall back upon that consideration and get the plaint amended to proceed against the respondent. It follows that the revision petitioner is not entitled to amend the plaint. 9. In the result, the revision petition fails and the same is dismissed with costs.