Judgment :- 1. Defendants 1 and 2 in O.S. No. 205 of 1991 on the file of Additional Sub Court, Srivilliputhur are the appellants. 2. Parties herein will be referred to according to their rank in the suit. 3. Plaintiff filed the above suit for recovery of an amount of Rs. 2,15,900/- with interest at 18% on the principal amount of Rs. 2,00,000/- from the date of plaint till date of realisation personally from second defendant and in alternative directing defendants 1 to 3 to pay the amount jointly and severally and in the alternative pass a personal decree against 2nd defendant and as against defendants 1 and 3 to be payable from the estate of late P.S.V Singaraja and for costs of the suit. 4. The material averments in the plaint could be summarised thus: Third defendant is the daughter of plaintiff. Late P.S. Velayutharaja, who died on 21.10.1985 is the husband of first defendant and father of second defendant. He had another son by name, Singaraja, and third defendant married him. 5. It is the case of plaintiff that after the death of father P.S. Velayutharaja, the business that was being conducted by late father was taken over by them. Father was running a cycle shop where he was dealing with bicycle for hire apart from fruits and house hold articles. He was also running a lodge under the name and style P.S.V. Buildings. After his death, elder son Singaraja and his brothers improved the business out of the United income of the properties and also by borrowing money from third parties. Late Velayutharaja had put up buildings in the lodge for which the family was in need of money for improvements. It is the case of plaintiff that defendants 1 and 2 along with late Singaraja approached plaintiff for financial arrangements and he used to help them to the extent of Rs. 10,000/- and Rs. 20,000/- depending upon the requirements. 6. During the end of June 1988, defendants 1 and 2 and late Singaraja were in dire need of more money, more than Rs. 2 lakhs pertaining to Dairy Farm, Cycle Mart, Central Traders, all of them are family concerns and also to a certain extent to the lodge. 10,000/- and Rs. 20,000/- depending upon the requirements. 6. During the end of June 1988, defendants 1 and 2 and late Singaraja were in dire need of more money, more than Rs. 2 lakhs pertaining to Dairy Farm, Cycle Mart, Central Traders, all of them are family concerns and also to a certain extent to the lodge. They wanted plaintiff to make some arrangements to help them and plaintiff paid the money on 18.8.1988 to defendants 1 and 2 and late Singaraja in their house at Rajapalayam. The amount paid did not carry any interest and no document was also taken in view of close relationship. Late Singaraja and defendants 1 and 2 agreed to return the amount within a period of six months. Plaintiff also agreed for such a course. 7. It is further alleged that the family was conducting Central Cycle Mart, Central Traders, P.S.V. Farms, P.S.V. Lodge and also carrying on registered chit fund business. Though the Chit Fund Business was in the name of Singaraja, it was conducted for the benefit of family. Singaraja died on 20.4.1989 and there was complete set back in the family, through various creditors and they decided to dispose of some of the properties standing in the name of late Singaraja and second defendant. Considerable money was mustered and majority of the debts were cleared. It is said that third defendant also joined second defendant in order to sell immovable properties and valuable house sites, for which no amount was given to third defendant. Whenever second defendant asked third defendant to sign documents, she used to do so. 8. So far as plaintiff is concerned, he has not taken any documents for the amount which he advanced to defendants 1 and 2 and Singaraja. That was exploited by second defendant by saying that he would not make any payment to plaintiff. When plaintiff came to know about such a talk, he informed the same to his caste elders and due to their intervention, an agreement was entered on 18.12.1990, whereby second defendant agreed to settle the claim of plaintiff. There was also some other arrangement in regard to the share of late Singaraja in the family properties. Second defendant agreed to pay a sum of Rs. 5,00,000/- to third defendant in monthly instalment of Rs. There was also some other arrangement in regard to the share of late Singaraja in the family properties. Second defendant agreed to pay a sum of Rs. 5,00,000/- to third defendant in monthly instalment of Rs. 7,000/- and in turn third defendant agreed to release all the rights which Singaraja had in the family properties. It is the case of plaintiff that by the agreement dated 18.12.1990, second defendant admitted and acknowledged the liability due to plaintiff and he is entitled to recover the amount which was paid to defendants 1 and 2 and late Singaraja. Suit Notice was issued for which a reply was sent wherein they refuted the transaction. 9. Defendants 1 and 2 have filed separate written statements and third defendant remained ex parte. 10. In the written statement filed by first defendant, it is said that P.S.V. Central Cycle Mart was a partnership concern of late P.S. Velayutharaja and his sons. She said that late Velayuthuraja had not borrowed any amount. She also denied the allegation that for the purpose of business, Rs. 10,000/- and Rs. 20,000/- were used to be borrowed from plaintiff is not true. Central Cycle Mart business was taken over by Singaraja and second defendant retired from the partnership by closing his accounts. Central Traders alone were run by them. Chit funds and Dairy Farm were run by Singaraja as Sole proprietor. They were started only after the death of P.S. Velayutharaja. The allegation that defendants borrowed a sum of Rs. 2,00,000/- from plaintiff is also denied. It is also said after death of Velayutharaja, Lodge business was done by Singaraja and second defendant. It is not family business. It is also said that a suit was also filed by third defendant for partition as O.S. 203 of 1991 and she denies her involvement in the agreement dated 18.12.1990. According to her, that agreement is not binding on her. 11. In the additional written statement, she disputed the claim for interest. 12. In the written statement filed by second defendant it is said that there was no necessity to borrow any amount from any person since the family was in affluent circumstances. According to her, that agreement is not binding on her. 11. In the additional written statement, she disputed the claim for interest. 12. In the written statement filed by second defendant it is said that there was no necessity to borrow any amount from any person since the family was in affluent circumstances. When Singaraja died, It was found that he borrowed huge amounts from various persons and therefore defendants 1 and 2 agreed to arrange funds of third defendants family solely with a view to save the family name and prestige and not as gracious act. The same was done on specific understanding that the same would be taken into account at the time of partition of properties. Second defendant was also discharging the debts incurred by his elder brother. Under the above circumstances, plaintiff and third defendant approached second defendant to give amount in view of third defendants debts and absolve her from the debts. 13. The matter was placed before the elders of the community and an agreement was entered on 18.12.1990. At that time, it was assured that except the said debts no further amount was due to third parties. They also assured that if any further debt came to light, they will be responsible for that. At the time of negotiation, plaintiff represented that a sum of Rs. 2,00,000/- is due to him from his son-in-law and third defendant insisted that second defendant, should pay the said amount. Considering all the circumstances, elders suggested that defendant should pay Rs. 5,00,000/- in full and exonerate third defendant and the said amount is to be paid in monthly instalments of Rs. 7,000/- It is also agreed that second defendant should pay Rs. 2,00,000/- to plaintiff. Second defendant agreed to the terms even though it was unfavourable to him. After the said agreement some more creditors also began to pressuring payment which was not disclosed, till then, even though defendant wanted that in regard to depts. which has not been disclosed till then must be taken care of third defendant only. She did not agree for the same. The monthly payment of Rs. 7,000/- which was paid for four months was therefore not paid later. According to him, he has not borrowed any amount from plaintiff and plaintiff has no capacity to raise that fund. He prayed for dismissal of the suit. 14. She did not agree for the same. The monthly payment of Rs. 7,000/- which was paid for four months was therefore not paid later. According to him, he has not borrowed any amount from plaintiff and plaintiff has no capacity to raise that fund. He prayed for dismissal of the suit. 14. Trial Court as per Judgment dated 19.11.1997 decreed the suit permitting plaintiff to recover a sum of Rs. 2,00,000/- with 10 1/2% interest from 13.5.1991 i.e., date of plaint till date of decree and thereafter at the rate of 6% on the original principal amount from the assets of the family of defendants 1 to 3. 15. Trial Court held that Ex.A1 agreement dated 18.12.1990 amounts to admission made by second defendant that the amount have been borrowed for the purpose of family and the plaint claim is also a borrowing for the benefit of family. Trial court further held that second defendant was not successful in explaining the admission made in Ex.A1. It further came to the conclusion that once borrowing is proved, plaintiff is entitled to succeed and it is not the concern of plaintiff whether Ex.A1 has been acted upon as between defendants 2 and 3. Trial Court further held that plaintiff is not making use of Ex.A1 to prove his claim but is only making use of it as an admission and acknowledgment. It further held that the debts discharged by second defendant evidenced by Exs. B8 to B.41 will only show that late Singaraja borrowed amount for the purpose of family and he used to discharge the debt. Borrowing from plaintiff is also for the same purpose as admitted in Ex.A1. 16. The matter was taken in A.S. 59 of J 998 on the file of District Judge, Srivilliputhur, lower appellate court confirmed the decree and Judgment of the trial Court and dismissed the appeal. 17. The following substantial questions of law have been raised by the appellants in the memorandum of appeal: (A) Are the Courts below justified in law, in granting the decree for the suit amount, based on Ex.A1 when admittedly the plaintiff was not a party to the said document but only signed the same as a witness? 17. The following substantial questions of law have been raised by the appellants in the memorandum of appeal: (A) Are the Courts below justified in law, in granting the decree for the suit amount, based on Ex.A1 when admittedly the plaintiff was not a party to the said document but only signed the same as a witness? (B) Have not the Courts below committed serious error in law in holding that the suit amounts was borrowed for the benefit of joint family when in fact as per the evidence of PW1 and the pleading is to the effect that the suit amount was given to his own son-in-law while he was carrying on business of his own and not for any joint family business? (C) Are the Courts below justified in drawing inference against defendants 1 and 2 as if the suit amount was borrowed by the plaintiffs son-in-law for the benefit of joint family when it has been roved beyond doubt by Bx.B4 to B41 that plaintiffs son-in-law was carrying on “Business as his own and that of joint family business. (D) Have not the Courts below committed error in law in not drawing adverse inference against the plaintiff for not proving his financial capacity to provide the loan mount on a single day? (E) Has not the trial Court misdirected itself in holding against defendants 1 and 2 on issues No. 1, when the plaintiff failed to prove the payment of suit amount to defendants 1 and 2 and Singaraja on 18.8.1988, when no evidence was let into prove the said lending by the plaintiff in a manner known to law except by relying upon the recitals under Ex.A1? (F) Can the Courts below validly grant the decree in favour of plaintiff based on the recitals under Ex.A1 without properly adverting to and appreciating the circumstances under which and the reason for which Ex.A1 was executed? “(G) Are not the judgment and decree of the Courts below vitiated for not considering the circumstances under which Ex.A1 was executed, when the claim is based on Ex.A1? (H) Have not the Courts below committed error in law in holding that the second defendant is liable to pay the suit amount also since he has cleared the personal debts of his brother which was borrowed by his brother for his own business and not for joint family business? (H) Have not the Courts below committed error in law in holding that the second defendant is liable to pay the suit amount also since he has cleared the personal debts of his brother which was borrowed by his brother for his own business and not for joint family business? (I) Are not the findings of the Courts below perverse and contrary to the very documentary evidence under Exs. B4 to B41 while considering the issue, whether the third defendants husband was doing the business of his own and contracted the suit debt for his own business and for the family businesses? (J) Have not the Courts below committed error in law in holding that the profit and loss of the business of the deceased Singaraja was shared by the Joint family when the evidence under Exs. B3 to B7, B42, to B58 and B61 to B83 will demonstrate that “each member in the family including one third defendant was carrying on their respective business and the profit & Loss was not at all shared by the family? (K) Have not the Courts below committed error in law in awarding interest when the plaintiff himself has agreed to waive the interest and when the same is saved by Section 3(3) of the Interest Act? (L) Have not the Courts below executed its jurisdiction in awarding interest at a higher rate and for a more period contrary to Section 3 (1) (a) or (b) of the Interest Act? (M) Are not the Judgment and Decree of the lower appellate Court vitiated for not following the mandatory provisions of Order 41 Rule 31 C.P.C? 18. Since caveat was entered, I heard the Second Appeal at the admission stage itself after calling for the records. 19. Learned Senior Counsel for appellants submitted that plaintiff, who is a stranger to ExA1 cannot enforce the contract and the suit laid on the basis of Ex.A1 is not maintainable. Counsel also placed reliance on various decisions of Honourable Supreme Court as well as various High Courts and contended that plaintiff not being a party to Ex.A1 cannot seek enforcement of the same. 20. I do not find any merits in the said submission. 21. On a reading of plaint it is clear that plaintiff is not enforcing any right under ExA1. 20. I do not find any merits in the said submission. 21. On a reading of plaint it is clear that plaintiff is not enforcing any right under ExA1. Suit is laid for recovery of the amount borrowed from plaintiff on 18.8.1988 by defendants 1 and 2 and late Singaraja. In para 5 of the plaint it is specifically stated that plaintiff paid the money on 18.8.1988 to defendants 1 and 2 and late Singaraja in their house at Rajapalayam. It is true that plaintiff is also relying on ExA1 but that is only for the purpose of admission of debt and consequent acknowledgement of liability. Para 8 of the plaint makes it clear. In para 8, it is said thus. “In fact an agreement was entered between the defendants 2 and 3 regarding “the sum of Rs. 2 lakhs apd other matters. It is submitted that such acknowledgement and acceptance of the sum of Rs. 2 lakhs payable to the plaintiff was at the suggestion and acceptance of the 1st defendant as after all she also along with the 2nd defendant and late Singaraja received Rs. 2 lakhs from the plaintiff.” In para 9, it is further said that, “The 2nd defendant had affirmed the clauses of the agreement dated 18.12.1990 thereby acknowledging his liability to pay off Rs. 2 lakhs.” And in the cause of action it is said that, “The cause of action for this suit arose on 18.8.1988 when the plaintiff had given Rs. 2.2 lakhs to the defendants 1 and 2 so also the third defendants husband at Rajapalayam for their financial requirement, on the said date when they promised that the sum would be paid off within a period of six months or within such dates when they were able to muster the monies, on 20.4.89 when the 3rd defendants husband died and the 2nd defendant had “taken the management of the family properties and family concerns on the dates when the demands were made, on the dates when defendants 1 and 2 promised to pay off and had been evading so, on 18.12.99 when the agreement was entered into wherein the 2nd defendant had acknowledged his liability to pay off the entire sum of Rs. 2 lakhs, ” From these statements, it is clear that plaintiff is not basing his cause of action on ExA1. 2 lakhs, ” From these statements, it is clear that plaintiff is not basing his cause of action on ExA1. He is relying on ExA1 only to prove that late Singaraja second defendant and his family borrowed amount from him and there is admission in ExA1. Question (A) is therefore found against the appellants. 22. All the other questions of law could be considered together. 23. Learned counsel submitted that in the suit notice no date was given as to when the amount was paid and only when the same was pointed out in the reply, plaint allegation was made that the borrowing was on 18.8.1988. Counsel submitted that absolutely no evidence have been let in before court to show that on 13.3.1988 second defendant, late Singaraja or first defendant had borrowed the mount from plaintiff. It is true there is no documentary evidence to prove that there was a borrowing on 18.8.1988. It is the definite came of plaintiff that being close relations and Singaraja being his own son-in-law, he never thought of taking any document. It is also his case that this is not the first time he is helping them and they used to borrow amounts according to their requirements of the business and the same was also being returned. On none of the occasions, he never thought of taking any document from his own son-in-law or his brother. 24. I do not think that merely because no document is produced to prove the debt, plaintiff is bound to fail if he has got other evidence to prove it. It is here ExA1 gains importance, which read thus. Tamil 25. In the written statement, it is alleged that late Singaraja had borrowed huge amounts and second defendant for the purpose of serving family needs and used to discharge the same. It is also said that at that juncture, third defendant wanted to get herself relieved from any liability and the same was placed before the elders of the community at whose instance an agreement was entered on 13.12.1990. Even though written statement speakers of various debts, the only debt referred to in ExA1 is only the amount due to plaintiff. It is also come in evidence that it was at the instance of plaintiff Panchayat was convened and before Panchayatdars, second defendant admitted the borrowings. Plaintiff is the first signatory and attestor to Ex.A1. Even though written statement speakers of various debts, the only debt referred to in ExA1 is only the amount due to plaintiff. It is also come in evidence that it was at the instance of plaintiff Panchayat was convened and before Panchayatdars, second defendant admitted the borrowings. Plaintiff is the first signatory and attestor to Ex.A1. It may also be mentioned in para 2 in Ex.A1 that they want settlement of common debts and only debt that is referred to is that of plaintiff. In para 3, it is also admitted that the debt was incurred for family, and second defendant took the responsibility of discharging the debt. As rightly contended by Senior Counsel for respondents Ex.A1 is both an admission and acknowledgment of liability. It is further stated in para 11 of the written statement that at the time of panchayat plaintiff represented that a sum of Rs. 2 lakhs is due to him from his son in law and elders suggested that this payment also should be made by defendant. It is in consequence of that representation, defandant also agreed stating that the amount was borrowed for the family and it is a family debt and agreed to discharge the same, in ExA1. 26. What is the effect of such an admission? In (1977) 3 Supreme Court Cases 540 = 90 L.W. 107 S.N. ( Thiru John v. Returning Officer ), it is held thus, “A partys admission under Sections 17-21 of the Evidence Act is substantive evidence proprio vigore and if it is clearly and unequivocally made, is the best evidence against the party making it, and through not conclusive, is enough to shift the onus on the maker”. 27. In (1979) 4 Supreme Court Cases 790 ( Avadh Kishore Das v. Ram Gopal ), their Lordships held thus, “Evidentiary admissions are not conclusive proof of the facts admitted and may be explained or shown to be wrong but they do raise an estoppel and shift the burden of proof on to the person making them or his representative in-interest. Unless, shown or explained to be wrong, they are an efficacious proof of the facts admitted. Unless, shown or explained to be wrong, they are an efficacious proof of the facts admitted. If, however, the admission as made by the predecessor consciously and not inadvertently and, far from explaining it, the succesor-in-interest affirms it, the admission would be a relevant evidence raising the estoppel.” 27-a. In 1971 (2) Supreme Court Cases 182 ( Narayanswami v. State of Maharashtra )., in para 4 it is held thus, “.An admission is a substantive evidence, though it is open to the person who made the admission to show that the fact admitted is not correct. In the absence of any such proof the admission has to be considered as an important piece of evidence”. 28. From the circumstances, it is clear that Ex.A1 was written intentionally and by their own showing, it was made after due deliberation. Before Panchayatdars, a representation was made by plaintiff and agreed by defendants. In fact that is the case pleaded by plaintiff in his plaint. According to him, when he has no document to support his claim and when there was a move by second defendant to amicable settlement in either way, one thing is clear that it was at the representation of plaintiff Panchayat was convened and second defendant also agreed having incurred debt for family and discharged the same. I have already said that even though written statement says that Panchayat was convened to discharge various debts the only debt mentioned is that of plaintiff. The admission in Ex.A-1 is substantive piece of evidence and unless the same is properly explained to be not true, the same is binding on second defendant. 29. In the reply, he has said that when the Panchayatdars persuaded to pay Rs. 2 lakhs he agreed, otherwise, there is danger of failure of talks between himself and third defendant. He further said that he was compelled and coerced to agree for the same and that is why he was obliged to agree to pay the amount to plaintiff. He also said the acknowledgment contained in Ex.A.1 was executed under coercion or is not a free one and was given a go by. When DW1 was examined nowhere he stated that the statement therein was under coercion or under pressure. He also said the acknowledgment contained in Ex.A.1 was executed under coercion or is not a free one and was given a go by. When DW1 was examined nowhere he stated that the statement therein was under coercion or under pressure. Of course in cross examination he states about the pressure but at the same time he said that he has never objected to the statement in ExA1 and he has not given any complainant to anyone. 30. The case of coercion that ExA-1 was not executed under free will is not pleaded by defendant. It is admitted by him that Rs. 7 lakhs was agreed to be paid to third defendant out of which Rs. 2 lakhs must be paid to plaintiff. The amount was to be paid to third defendant in instalments. It was pursuant to this arrangement, second defendant also paid four instalments. He has also acted on Ex.A.1. Only when some other debts crept up, he withdrew his admission as mistake or that is not true, trial court as well as lower appellate court held that the parties are close relations and there is nothing to disbelieve the statement of plaintiff that he paid the amount without any record. In fact he had to convene the Panchayat only because there was no record for the loan. 31. Admittedly, the family of Velayutharaja is not divided. Velayutharaja died in 1985 and Singaraja died in 1989. Singaraja being the elder son was managing the family as manager. If he borrows any amount and if it is for moral purpose or for other reasons recognised under Hindu Law, it is binding on the family. Second defendant admitted that Singaraja had no vices. 32. Second defendant himself has filed Exs.B8 to B41, various Promissory notes and documents to show that the same had been discharged. Most of the borrowings are made by Singaraja. If Singaraja had borrowed personally, what made second defendant to discharge those debts. It is not a small amount and learned counsel for appellants placed before me the statements of accounts which he discharged covered under Exs. B8 to B41. It comes to more than Rs. 9 lakhs. It is their case that Singaraja was doing his own business and second defendant also was doing independent business. It is not a small amount and learned counsel for appellants placed before me the statements of accounts which he discharged covered under Exs. B8 to B41. It comes to more than Rs. 9 lakhs. It is their case that Singaraja was doing his own business and second defendant also was doing independent business. The joint family was not having any business and the members of the family are having independent business or joint family business. The only question is whether debt was incurred for the benefit of all the members who were doing one/business or other. It is specific case of plaintiff that even though various businesses are being done in the name of Singaraja or for the benefit of entire family, the subsequent conduct of the second defendant also supports the case of plaintiff. 33. Learned Senior counsel for appellants submitted that merely because he volunteered to discharge certain debts that should not be a reason to hold that said debt also must be saddled on his head. The submission of learned counsel is correct. If Ex.A1 was not there, this argument could have been accepted. In Ex.A1 there is specific statement that this is a common debt and incurred for the benefit of the family and that statement was made by second defendant himself. According to me Ex.A1, apart from an admission and acknowledgment of liability also amounts to estoppel as against second defendant. He cannot withdraw from that commitment and that too made before Panchayat. 34. A feeble argument was put forward by learned counsel for appellants that third defendant had already filed a suit as O.S. 203 of 1991 [See 2001 2 L.W. 97 (D.B.) — Ed.] ignoring Ex.A1 and claiming partition. Whatever may be the inter se dispute between defendants 2 and 3 that cannot affect the rights of plaintiff who has paid hard cash, to the family of second defendant. Counsel submitted that question whether it is a personal debt of late Singaraja or whether it is family debt should be decided only in the suit filed by third defendant and this suit also should have been tried along with that suit. I do not find merit in the said submission. 35. Plaintiff is entitled to recover the amount which he has given to family and asking him to wait till family dispute is over, is not proper. 36. I do not find merit in the said submission. 35. Plaintiff is entitled to recover the amount which he has given to family and asking him to wait till family dispute is over, is not proper. 36. Lower court has given a decree as against the assets of the family. First defendant is also a member of the family. The question is as to how far Ex.A1 is binding on her. First defendant has no case that second defendant is acting against her interest. It is also definite case of plaintiff that the amount was borrowed by first defendant also and amount was paid at her residence, when demand was made by all the three, i.e., defendants 1 and 2 and late Singaraja. That case has been accepted by trial court as well as lower appellate court. 37. An argument was also advanced by learned Counsel for appellants that the plaintiff has not proved the source of his financial capacity to advance the amount. I do not think that question is relevant when the debt is admitted, and second defendant also agrees to discharge the same. Plaintiff has stated that on the previous day, he has sold some of his immovable properties and was having cash for paying defendants 1 and 2 and late Singaraja. Plaintiff has not been cross-examined regarding that statement. 38. I do not find that ExA-1 is invalid for all the reasons stated in the written statement which have not been proved by defendants. 39. All the questions of law have been found against appellants and consequently the appeal is dismissed. Taking into consideration the close relationship between parties, I direct them to bear their respective costs. Consequently, C.M.P. Nos. 5512, 5513 and 12639 of 1999 are dismissed.