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2017 DIGILAW 149 (KAR)

MUNIYAPPA, S/O NARAYANAPPA v. LAKSHMI FINANCIERS

2017-01-25

K.N.PHANEENDRA

body2017
JUDGMENT : Heard the learned counsel for the appellants/defendants and the respondent-M/s. Lakshmi Financiers (plaintiff) with regard to admission. Perused the judgment of the trial Court and the First Appellate Court and also the other documents available before this Court. 2. Learned counsel for the appellants/defendants strenuously contends before this Court that, the trial Court and the First Appellate Court have not framed proper issues and not considered the defence taken up by the defendant and no findings have been given pertaining to the legal question i.e., under Section 24 of the Karnataka Money Lenders Act (for short, ‘KML Act’). He further contends that the trial Court and the First Appellate Court have relied upon the evidence of the expert, who in fact is not an expert, as he has not passed any course for examining the questioned signature on the disputed documents. Further, the learned counsel contends that the trial Court and the First Appellate Court have not properly appreciated the oral evidence of the plaintiff (PW.1). He also contends that there is no material to show that respondent-M/s. Lakshmi Financier having any licence as such to deal with Money Lending, business. 3. Per contra, learned counsel for the respondent-M/s. Lakshmi Financier, though not specifically denied the above said points, however submitted that, on over all reading of the judgment of the trial Court and the First Appellate Court, it is established that the Court has applied its judicious mind and answered all the questions raised by the defendant and ultimately decreed the suit of the plaintiff for a sum of Rs.3,52,000/- with interest at the rate of 9% pa, though the plaintiff has requested for interest at the rate of 16% pa. Therefore, he submits that the Court has appreciated the oral and documentary evidence on record and even the legal points have also been covered, though not specifically by way of framing of issues. Therefore, he contends that the judgment of the trial Court and the First Appellate Court are in accordance with law and it does not call for any interference as no substantial question of law arises for consideration. 4. As could be seen from the judgment of both the courts below, they have concurred the factual aspects with regard to money transaction. The plaintiff has filed suit for recovery of a sum of Rs.3,00,000/- along with interest at the rate of 16% pa. 4. As could be seen from the judgment of both the courts below, they have concurred the factual aspects with regard to money transaction. The plaintiff has filed suit for recovery of a sum of Rs.3,00,000/- along with interest at the rate of 16% pa. on the basis of the Promissory Note and consideration receipt executed by the defendant. The defendant entered his appearance and he has denied even the signature on the Promissory Note and also execution of any document but it is also not his contention that the document is concocted or forged. Apart from denial of plaintiffs case, the defendant has also taken-up the contention in the written statement that the plaintiff is not holding any valid licence for Money Lending and he was not able to establish the existence of license, under the Karnataka Money Lending Act and Rules thereunder. The trial Court, on the basis of rival contentions of the parties, has framed the following issues:- (i) Whether the plaintiff proves that the defendant borrowed a sum of Rs.3,00,000/- on 02.06.2006 by executing on demand promissory note, agreeing to repay with interest? (ii) Whether the plaintiff proves that the defendants had not repaid the loan amount? (iii) Whether the suit is not maintainable? (iv) Whether the plaintiff is entitled for the suit claim? (v) What decree or order? 5. The trial Court while answering the above said issues has in detail considered the documents produced before the Court and also considered the expert’s evidence and has come to the conclusion that the plaintiff has proved execution of Promissory Note and consideration receipt and thereafter found that M/s. Lakshmi Finance being a proprietorship firm there is a licence in the name of Mr. T.P. Ashok Kumar proprietor and came to the conclusion that the plaintiff has established the case and has decreed the suit. 6. Being aggrieved by the said judgment, the appellant (defendant) preferred an appeal before the II Additional District and Sessions Judge, Shivamogga in R.A. No. 235/2012. He has taken several grounds attacking the judgment of the trial Court. The First Appellate Court has in fact culled-out the pleadings of the parties and the grounds urged before the First Appellate Court and by giving reasons after re-appreciating the oral and documentary evidence on record, has dismissed the appeal confirming the judgment of the trial Court. He has taken several grounds attacking the judgment of the trial Court. The First Appellate Court has in fact culled-out the pleadings of the parties and the grounds urged before the First Appellate Court and by giving reasons after re-appreciating the oral and documentary evidence on record, has dismissed the appeal confirming the judgment of the trial Court. Against the concurrent finding, the appellants (defendants) are before this Court by way of this second appeal. 7. Now let me examine the argument addressed by the learned counsel in the light of the judgments impugned and materials on record. Of course the trial Court has not framed any specific issue with regard to the licence and also following up of the mandatory provisions under the Karnataka Money Lenders Act. However, it framed Issue No.1 with regard to the plaintiff proving the factum of defendants borrowing a sum of Rs.3,00,000/- and executing demand promissory note and consideration receipt. The third issue is with regard to, whether the suit is maintainable or not. The trial Court has considered Exs.P1 to P3 which are the Promissory Note, Licence and Encumbrance Certificate and Ex.P1(a) is the signature of DW.1 i.e., defendant. The Court has come to the conclusion that at the earliest point of time when the written statement was filed, defendant has denied his signature also. Learned counsel for the respondent pointed that the said person has not only denied the signature on the promissory note, but he has gone to the extent of denying his signature on the written statement. The trial Court considering the above said aspects, basing its opinion on the expert’s evidence and also examining the signature by itself under Section 73 of the Indian Evidence Act, has come to the conclusion that the plaintiff has proved execution of the promissory note. Though the learned counsel for the appellant has strenuously contends that the plaintiff has not in detail stated as to how and in what manner money has been paid and for what purpose the money has been paid, but he has not produced any evidence etc., in this regard. Though the learned counsel for the appellant has strenuously contends that the plaintiff has not in detail stated as to how and in what manner money has been paid and for what purpose the money has been paid, but he has not produced any evidence etc., in this regard. The evidence also shows that the plaintiff has invariably denied about the execution of the document (Promissory Note) at initial stages, when once execution of the Promissory Note is established, the burden shifts on to the defendant to show that no consideration has been passed and contents of the promissory note and consideration receipt are all false. Under Section 118 of the Negotiable Instrument Act, (NI) Act, presumption arises that, when once the denied signature is proved satisfactorily before the Court, then the onus shifts on to the defendant to establish that the consideration has not been passed on to him. It is the duty of the defendant to establish the said fact. On the other hand, a presumption raised in favour of the plaintiff cannot be said to have been rebutted by the defendant, if cogent, convincing and strong evidence is not placed before the Court. If a person gone to the extent to deny his signature on the Promissory Note, if the plaintiff is able to establish the signature on the document, then the defendant cannot be allowed to question the contents of the document, in view of Section 118 of the N.I. Act. Therefore, I do not find any strong reasons to differ from the opinion expressed by the trial Court. 8. With regard to acceptance of the experts evidence, (CW1) C.V. Jayadevi, the learned counsel contended that the Handwriting Expert has not undergone any training or she has not passed any competitive examination with regard to examination of Handwriting. On a careful reading or Order 26 Rule 9 of CPC or Section 45 of the Indian Evidence Act, it only shows that the person who is having experience in that line, can be called as an expert. But, there is no specification as to an expert should have passed any examination as such. Therefore, it should be shown to the Court that the expert had undertaken the job of examination of handwriting as an expert since long time and he/she has experience to examine the documents. But, there is no specification as to an expert should have passed any examination as such. Therefore, it should be shown to the Court that the expert had undertaken the job of examination of handwriting as an expert since long time and he/she has experience to examine the documents. In this background, if the evidence of the experts is seen, it is categorically elicited that she has been doing the work of examination of handwriting since long and she has rich experience in examining handwriting on the disputed documents is she has given evidence before the Courts. Further more, the trial Court and the First Appellate Court have categorically examined that at the time of appointing expert by the Court, there was no objection by the other side. Even the defendant would have taken such contention that the expert has no experience in examining hand writing on the documents even at the earliest point of time but the defendant has not taken any such contention for the sake of contradicting the evidence of the expert. It appears during the course of cross examination, some questions have been put to test the veracity of the expert. Even otherwise, both the courts below taking support of the expert’s evidence have also examined themselves with regard to signature on the documents as contemplated under Section 73 of the Indian Evidence Act. Of course, the Court itself has not stepped into the shoes of the expert’s for independent examination, but after appreciating the Expert’s evidence available on record, taking the help of the same, the trial Court and the First Appellate Court have made their efforts to give finding regarding the signatures of the defendant on these documents. Therefore, the said exercises done by the First Appellate Court and the trial Court cannot be easily brushed aside. There is no reason to state that the courts below have committed any wrong in considering the signature of the defendant on the Promissory Note. Therefore, I am of the considered opinion that no legal error has been committed by the trial Court or the First Appellate Court in giving finding with regard to proof of execution of the Promissory Note by the defendant. 9. Learned counsel further contended another legal point that the trial Court has not looked into Section 24 of the KML Act 1961, which reads thus:- ‘24. 9. Learned counsel further contended another legal point that the trial Court has not looked into Section 24 of the KML Act 1961, which reads thus:- ‘24. PROCEDURE OF COURTS IN SUITS REGARDING LOANS – Notwithstanding any thing contained in any law for the time being in force, in any suit to which this Act applies, (a) a Court shall, before deciding the claim on merits, frame and decide the issue whether the money lender has complied with the provisions of Sections 20 and 21; (b) if the Court finds that the provisions of Section 20 or Section 21 have not been complied with by the money lender, it may if the plaintiff’s claim is established, in whole or in part, disallow the whole or any portion of the interest found due as may seem reasonable to it in the circumstances of the case and may disallow costs. Explanation – A money lender who has given the receipt or furnished a statement of accounts or a pass book in the prescribed form and manner, shall be held to have complied with the provisions of Section 20 or Section 21, as the case may be, in spite of any errors and omissions if the Court finds that such errors and omissions are not material or not fraudulent.” 10. Learned counsel banking upon his argument on the first part of Section 24 of KML Act, has submitted that it is the duty of the Court to decide the claim on merits by framing and deciding an issue whether the Money Lender has complied with the provision under Section 24. Clause (b) of the said provision virtually runs as an exception to Clause (a), which says that if the Court finds that the provisions of Section 20 or 21 have not been complied with by the Money Lender, it may, if the plaintiff’s claim is that he has established, in whole or in part, disallow the whole or any portion of the interest found due as may be seen reasonable to it in the circumstances of the case and may disallow costs. 11. Even considering that the trial Court has not framed any specific issue or it has not given any specific finding with regard to this, nevertheless the trial Court and the First Appellate Court have understood the case of the parties and gave their finding regarding the maintainability of the suit. 11. Even considering that the trial Court has not framed any specific issue or it has not given any specific finding with regard to this, nevertheless the trial Court and the First Appellate Court have understood the case of the parties and gave their finding regarding the maintainability of the suit. 12. The third issue which is framed with reference to maintainability of the suit perhaps may be for the reason that the defendant has taken up a contention that Section 24 is a bar to maintain a suit. The Court has given its finding sofar as Issue No.1 is concerned that, the plaintiff has established its claim by means of leading cogent and convincing evidence on record with reference to the Promissory Note. Therefore, that is the reason why the Court has come to the conclusion that the plaintiff is not entitled for the interest at 16% pa. and therefore, it reduced the rate of interest to 9% pa. Though it has not been spelled out specifically quoting Section 24, virtually the trial Court has curtailed the rate of interest without assigning any reason. Therefore, it goes to show that the trial Court has come to the conclusion that, though the plaintiff has pleaded that he is entitled for 16%, no other reasons have been assigned as to why the Court has reduced the rate of interest from 16% pa to 9% pa. Therefore, in my opinion, though it is not specifically spelled out in the judgment, it goes without saying that the rate of interest has been reduced by the Court, therefore the said finding virtually comply the provisions of Section 24 of the KML Act. 13. Last but not least, with reference to the licence, though the defendant has taken up a contention that the trial Court and the First Appellate Court have observed that the licence has been produced, but it is in the name of the plaintiff, not in the name of M/s. Lakshmi Financier. As rightly contended by the learned counsel for the respondent and the said contention is considered by both the courts below that it is a proprietorship firm, if it is a proprietorship firm, if the licence is issued in the name of sole proprietor, that would be sufficient to hold that the said Finance Firm has got valid licence to deal with Money Lending business. 14. 14. Looking to the above facts and circumstances of the case, I am of the opinion that there is absolutely no substantial question of law arises for consideration because, on over all reading of the judgment of the trial Court and the First Appellate Court, both the courts have applied their judicious mind with regard to the facts and circumstances of the case and even the legal points involved, and ultimately disposed of the case by recording concurrent finding. Therefore, the appeal deserves to be dismissed at the stage of admission itself as no substantial question of law arises for consideration. Accordingly, the appeal is *dismissed at the stage of admission itself, with costs of this appeal.