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2012 DIGILAW 1378 (MAD)

M. Rajasekaran v. N. Subramaniam

2012-03-15

T.RAJA

body2012
Judgment 1. The present Second Appeal has been preferred by the plaintiff aggrieved by the reversal of the judgment and decree passed by the trial Court by the first appellate Court on appeal filed by the defendant. 2. Brief facts leading to filing of this second appeal are as follows: On the first occasion, the respondent / defendant borrowed a sum of Rs.30,000/- from on Sivakumar on 27.03.2000 by executing Ex.A.1, the pro-note dated 27.03.2000 in favour of Sivakumar for purchasing of lands, on the second occasion the respondent /defendant borrowed another sum of Rs.30,000/- from one Vanaja, the wife of Anbazghan by executing Ex.A.4, the pro-note dated 08.07.2002, on the third occasion, the respondent /defendant borrowed a sum of Rs.30,000/- from one Mahalakshmi, the wife of Sivakumar by executing Ex.A.6, the pro-note dated 10.7.2002 and on the fourth occasion, the respondent / defendant borrowed a sum of Rs.30,000/-from one Karpagam, the wife of Vadivazghan by executing Ex.A.8, the promissory note dated 18.7.2002 undertaking to repay the said amounts to them or to their authorised person with interest at the rate of 12% per annum. The respondent/defendant paid a sum of Rs.1,000/- on 19.2.2003 and acknowledged his liability by making payment and endorsement. The said Sivakumar, Vanaja, Mahalakshmi and Karpagam made over their pro-notes namely Exs. A.1, A.4, A.6 and A.8 on 5.1.2004, 23.1.2004, 10.1.2004 and 21.1.2004 respectively in favour of the appellant / plaintiff for valuable consideration. Thus, the status of the appellant / plaintiff is a bona-fide holder in due course of the above said suit pro-notes for consideration and he is entitled to collect the amounts of pro-notes namely, Exs.A.1, A.4, A.6 and A.8 dated 27.3.2000, 8.7.2002, 10.7.2002 and 18.7.2002. Hence, the appellant/plaintiff issued Ex.A.10, the notice dated 5.2.2004 to the respondent /defendant to repay the entire amounts in respect of pro-notes and the respondent/defendant received the said notice on 6.2.2004. The respondent / defendant did not come forward to repay the money in spite of several demands made by the appellant / plaintiff. Hence, the appellant / plaintiff was constrained to file a suit praying for directing the defendant to pay a sum of Rs.1,50,210/- with subsequent interest at the rate of 12% per annum. The trial Court, after hearing the submission made by both sides and on perusing the materials available on record, decreed the suit in favour of the plaintiff. Hence, the appellant / plaintiff was constrained to file a suit praying for directing the defendant to pay a sum of Rs.1,50,210/- with subsequent interest at the rate of 12% per annum. The trial Court, after hearing the submission made by both sides and on perusing the materials available on record, decreed the suit in favour of the plaintiff. On appeal, the first appellate Court reversed the judgment and decree passed by the trial Court holding that the case of the appellant/plaintiff falls foul of preponderance of probabilities. As against the impugned judgment and decree passed by the first appellate Court, the present second appeal has been preferred before this Court. 3. Heard Mr. S.K. Raghavan, learned counsel appearing for the appellant / plaintiff and Mrs. R. Meenal, learned counsel appearing for the respondent / defendant. 4. At the time of admission of the above second appeal, the following substantial questions of law were framed: "i) Whether the judgment of the lower appellate Court in reversing the judgment of the trial Court is vitiated by its failure to consider Section 9 and Section 118 of the Negotiable Instruments Act in its proper perspective? ii) Whether the judgment of the lower appellate Court is vitiated by its failure to consider the provisions of Sections 101 and 102 of the Indian Evidence Act with regard to burden of proving the suit promissory notes and the endorsement of assignment?" 5. The learned counsel appearing for the appellant/plaintiff has submitted that the respondent / defendant has borrowed a sum of Rs.30,000/-each on four occasions from Sivakumar, Vanaja, Mahalakshmi and Karpagam by executing suit pro-notes namely Exs.A.1, A.4, A.6 and A.8 on 27.03.2000, 8.7.2002, 10.7.2002 and 18.7.2002 respectively undertaking to repay those amounts with interest at the rate of 12% per annum to them or their authorised persons and the said pro-notes were made over in favour of the appellant/plaintiff for valuable consideration. After receiving the above said amounts by executing four suit pro notes, the respondent / defendant has made a part payment of Rs.1,000/- on 19.2.2003 in respect of Ex.A.1, the pro-note dated 27.3.2000 and made an endorsement to that effect on the said pro-note. Subsequently, Sivakumar, Vanaja, Mahalakshmi and Karpagam made over the aforesaid suit pro-notes in favour of the appellant / plaintiff on 5.1.2004, 23.01.2004, 10.1.2004 and 21.1.2004 respectively for valuable consideration, which has been pleaded before this Court. Subsequently, Sivakumar, Vanaja, Mahalakshmi and Karpagam made over the aforesaid suit pro-notes in favour of the appellant / plaintiff on 5.1.2004, 23.01.2004, 10.1.2004 and 21.1.2004 respectively for valuable consideration, which has been pleaded before this Court. Thus, the appellant/plaintiff has become holder in due course. As the status of the appellant/plaintiff is the holder in due course, when the respondent / defendant failed to repay the entire amount in respect of the pro-notes, the appellant / plaintiff issued Ex.A.10, the notice dated 5.2.2004 calling upon the respondent / defendant to pay the entire amount. Since, no reply and no payment whatsoever was forthwith received from the respondent/defendant, the appellant/plaintiff was constrained to file the suit on the basis of pro-notes claiming a sum of Rs.1,50,210/- with subsequent interest at the rate of 12% per annum from the respondent / defendant. 6. The respondent/defendant by filing a detailed written statement took forcible submissions denying the execution of the suit pro-notes and the made over of the pro-notes made over by Sivakumar, Vanaja, Mahalakshmi and Karpagam to the appellant /plaintiff was not supported by any consideration. 7. It was further contended before the trial Court that the appellant / plaintiff was only a name lender. The respondent/ defendant has executed a mortgage deed in favour of Anbalagan, son of Kuzhandaivelu Mudaliar for a sum of Rs.35,000/- on 23.08.1999 for obtaining a loan amount of Rs.30,000/-. The respondent / defendant also executed another mortgage deed in favour of Anbalagan, son of Kuzhandaivelu Mudaliar on 21.10.1999, but no amount was paid under the mortgage deed on 21.10.1999. It was also further pleaded before the trial Court that it is the practice of Kuzhandaivelu Mudaliar to prepare pro-notes in favour of his wife, sons, daughters, daughter-in-laws and close relatives and also to fabricate the pro-notes. With this back ground, the respondent/defendant has pleaded that under no circumstances, the appellant/ plaintiff can prove the passing of consideration for having executed the above said pro-notes. With this back ground, the respondent/defendant has pleaded that under no circumstances, the appellant/ plaintiff can prove the passing of consideration for having executed the above said pro-notes. The trial Court, on considering the facts in issue by taking into account the vital aspect that the respondent /defendant has admitted his signature in Ex.A.1, the pro-note dated 27.3.2000 by applying Sections 118, 120 and 121, after seeing his conduct, which was shown in the witness box that even without looking at the signatures shown to him by the learned counsel for the plaintiff, denied his very signature, decreed the suit as prayed for believing the case of the appellant / plaintiff. Aggrieved by the judgment and decree passed by the trial Court, an appeal was preferred. The first appellate Court has reversed the reasoning given by the trial Court holding that the trial Court has committed serious error in decreeing the suit for recovery of a sum of Rs.1,20,000/-without giving a categorical fining on execution of the pro-notes and also without establishing the passing of consideration. Under these circumstances, the matter has been brought before this Court. 8. The learned counsel appearing for the appellant/plaintiff has submitted that when the suit pro-notes namely, Exs.A.1, A.4, A.6 and A.8 dated 27.3.2000, 8.7.2002, 10.7.2002 and 18.7.2002 were executed in favour of Sivakumar, Vanaja, Mahalakshmi and Karpagam respectively for a sum of Rs.30,000/-each and the respondent/defendant has also made a part payment of Rs.1,000/-and acknowledged his liability by making payment and endorsement in respect of Ex.A.1 and when the respondent/defendant has also admitted the signature, it is not open to the respondent /defendant to take a different stand against the holder in due course that too after accepting the signature and after giving no plausible reply to the Court. Under such circumstances, Ex.A.2 dated 19.2.2003 reveals the fact that the respondent /defendant has made the part payment. The first appellate Court has ignored the categorical finding rendered by the trial Court and passed the judgment and decree in favour of the respondent/defendant, who bluntly refused the signature even without looking at his signature. The said judgment and decree should be interfered with as the same has been passed without any application of mind. 9. The first appellate Court has ignored the categorical finding rendered by the trial Court and passed the judgment and decree in favour of the respondent/defendant, who bluntly refused the signature even without looking at his signature. The said judgment and decree should be interfered with as the same has been passed without any application of mind. 9. It was also further contended by the learned counsel for the appellant / plaintiff that when admittedly, Sivakumar, Vanaja, Mahalakshmi and Karpagam were made over their pro-notes in favour of the appellant / plaintiff by way of proper assignment of Ex.A.1, A.4, A.6 and A.8 dated 5.1.2004, 23.01.2004, 10.1.2004 and 21.1.2004 respectively, it is absolutely not possible in law for the respondent/defendant to question the assignment by merely making oral denial that no consideration was passed on. 10. To support his case, the learned counsel for the appellant/plaintiff has submitted that when there was a specific notice Ex.A.10 dated 5.2.2004 issued calling upon the respondent/defendant to pay back entire money in terms of the suit pro-notes Exs.A.1, A.4, A.6 and A.8 dated 27.3.2000, 8.7.2002, 10.7.2002 and 18.7.2002 followed by the assignment dated 5.1.2004, 23.01.2004, 10.1.2004 and 21.1.2004 respectively, admittedly, the respondent / defendant has not bothered even to send any reply. As these vital aspects had been erroneously overlooked, the finding given by the first appellate Court is liable to be interfered with. 11. Again in support of his submission, the learned counsel for the appellant / plaintiff relied upon one another decision in KADIR MOIDEEN ROWTHER AND OTHERS V. ASIARU (AIR 1934 MADRAS 702) for a proposition that if a person, who signs the pro-note, takes a different stand that there was no such execution of pro-note, it has to be presumed that there has been a consideration passed. In the above said decision, it is held as follows: "Therefore, the maker is not entitled to go into the question of consideration as between the payee and the endorsee and even if the endorsee be a mere assignee for collection the maker cannot resist his claim on the ground that there was no consideration for the assignment" 12. In the above said decision, it is held as follows: "Therefore, the maker is not entitled to go into the question of consideration as between the payee and the endorsee and even if the endorsee be a mere assignee for collection the maker cannot resist his claim on the ground that there was no consideration for the assignment" 12. Adding further, he has also relied upon yet another decision in VARADARAJAN PILLAI, MINOR BY GUARDIAN MALAYAPERUMAL PILLAI V.KRISHNAMURTHI PILLAI (AIR 1941 MADRAS 321) for a proposition that " it was not open to the respondent /defendant to contend that the creditor under the pro note or under the decree was not the person whose name appeared as the payee on the note and the decree-holder on the decree, and that therefore the pro-note could not be regarded as a renewal in favour of the same creditor". 13. The learned counsel for the appellant / plaintiff has also pressed into service one another argument that Sections 120 and 121 of the Negotiable Instruments Act, 1881, enact a Rule of Estoppel, against denying the original validity of payee in one case and the capacity of the payee to endorse in the other and do not relate to the question who is entitled to sue on the instrument and can thus be regarded as the creditor under it. 14. The object of the Act is to give relief to the person, who prima facie establishes the fact that the pro-note was executed by simply taking admission from the payer. 15. Lastly, the learned counsel for the appellant/plaintiff has brought to the notice of this Court that when the plaintiff has produced P.W.2, P.W.3 and P.W.4, the attestors and witness of assignment and one another witness P.W.5 attestor in the made over documents, the trial Court accepting all these witnesses, has rightly come to the conclusion that the pro-notes namely, Exs.A.1, A.4, A.6 and A.8 dated 27.3.2000, 8.7.2002, 10.7.2002 and 18.7.2002 are valid by made over and have been properly established beyond all reasonable doubt. When there has been a specific and explicit finding arrived at by the trial Court, it is not proper on the part of the first appellate Court in simply ignoring Ex.A.2 and taking a different view for having any nexus to the case of the appellant/plaintiff before the trial Court. When there has been a specific and explicit finding arrived at by the trial Court, it is not proper on the part of the first appellate Court in simply ignoring Ex.A.2 and taking a different view for having any nexus to the case of the appellant/plaintiff before the trial Court. On this basis, he prayed this Court to interfere with the impugned judgment and decree passed by the first appellate Court. 16. Per contra, the learned counsel for the respondent / defendant has submitted that at no point of time, the appellant/plaintiff has proved before the trial Court or before the first appellate Court about the passing of consideration in the above said pro-notes namely, Exs.A.1, A.4, A.6 and A.8 dated 27.03.2000, 8.7.2002, 10.7.2002 and 18.7.2002 respectively executed in favour of Sivakumar, Vanaja, Mahalakshmi and Karpagam even after the execution of made over documents Exs.A.3, A.5, A.7 and A.9 dated 5.1.2004, 23.01.2004, 10.1.2004 and 21.1.2004, again he pleaded, neither the execution of pro-notes nor the execution of assignment deeds was established beyond reasonable doubt in support of any acceptable evidence. 17. In respect of Ex.A.10, the notice dated 5.2.2004, it was also contended by the respondent / defendant that the respondent /defendant has not failed to send a reply to Ex.A.10, the notice dated 5.2.2004, in view of the fact that the appellant/plaintiff has rushed to the Court within ten days from the date of issuance of the above said notice and no sufficient time was given to the respondent /defendant to reply. These aspects have been properly considered by the first appellate Court holding that non sending of reply to Ex.A.10, the notice dated 05.02.2004 cannot be held against the respondent /defendant since the appellant / plaintiff has laid his claim prematurely without waiting for sufficient time to reply. These aspects have been properly considered by the first appellate Court holding that non sending of reply to Ex.A.10, the notice dated 05.02.2004 cannot be held against the respondent /defendant since the appellant / plaintiff has laid his claim prematurely without waiting for sufficient time to reply. These arguments made by the learned counsel appearing for the respondent / defendant do not take this Court to any logical consequence for more than on reason that when there has been four pro-notes Exs.A.1, A.4, A.6 and A.8 dated 27.03.2000, 8.7.2002, 10.7.2002 and 18.7.2002 for payment of Rs.30,000/- in favour of Sivakumar, Vanaja, Mahalakshmi and Karpagam and the appellant/plaintiff has also made a part payment on 19.3.2003 by repaying a sum of Rs.1,000/- and beyond all reasonable doubt an endorsement to that effect was also made, as rightly pointed out by the learned counsel for the appellant under Section 118 (a) the pro-note is presumed to be genuine and as a result there is a presumption that there has been a valid consideration passed on the pronote. Further, as pointed out by the learned counsel appearing for the appellant/plaintiff though there has been a specific finding given by the trial Court on this issue, no finding has been given by the first appellate Court as to whether the respondent/defendant has made any part payment of Rs.1,000/- towards Ex.A.1 and an endorsement in Ex.A.2. To disbelieve the case of the respondent/defendant, there has been a specific notice Ex.A.10 dated 05.02.2004, though there was a sufficient time of 10 days before filing of the suit by the appellant / plaintiff and even after filing of the suit before the trial Court on receipt of summon from the trial Court, the respondent /defendant had sufficient time to reply to Ex.A.10 notice dated 05.02.2004. Therefore, as there was an admission of the respondent /defendant that the signature made in the pro-notes namely Exs. A.1, A.4, A.6 and A.8 dated 27.3.2000, 8.7.2002, 10.7.2002 and 18.7.2002 are his signatures and when there was no specific explanation or denial to the part payment made Ex.A.2 dated 19.2.2003 for repaying a sum of Rs.1,000/- in respect of first pro-note Ex.A.1 dated 27.3.2000, this Court has no other option except to restore the judgment and decree passed by the trial Court. 19. 19. While reversing the judgment and decree passed by the trial Court, the first appellate Court has not given any satisfactory finding as required under Order 41 Rule 31 of CPC, as to under what circumstance, the evidence of P.Ws.2,3,4 and 5 the attesters of the pro-notes and the attesters of assignment have suffered any infirmity. In that view of the matter, this Court comes to the conclusion that the trial Court has given categorical findings and this Court finds no proper reason to interfere with the judgment and decree passed by the trial Court and therefore this Court is necessarily bound to interfere with the impugned judgment and decree passed by the first appellate Court. Accordingly, the judgment and decree passed by the first appellate Court is set aside and for the above mentioned reasons, the judgment and decree passed by the trial Court is restored. 20. In the result, the second appeal is allowed. There is no order as to costs.