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2025 DIGILAW 838 (TS)

Pulusu Venkanna v. Jakkula Vijaya Laxmi

2025-06-09

G.RADHA RANI

body2025
ORDER : G.RADHA RANI, J. This Civil Revision Petition is filed by the petitioner-defendant aggrieved by the order dated 20.01.2025 passed in O.S No.22 of 2021 by the Senior Civil Judge, Suryapet, holding the document dated 16.02.2018 as promissory note and marking it as Ex.A4 during the chief examination of PW.1. 2. The facts of the case in brief are that the respondent-plaintiff filed the suit for recovery of money of Rs.20,30,000/- alleged to be due under a pro-note. The plaintiff contended that she was a senior citizen of 73 years of age. The defendant was doing Real Estate business and as a part of his business, he approached the plaintiff and purchased the lands from the plaintiff at Reddygudem village for a consideration of Rs.25,00,000/-. He paid part of the amount and stated that he would pay the balance amount of Rs.14,00,000/- with interest @ 18% per annum on demand and convinced her that it would be useful for the plaintiff, as she was at her advanced age. The plaintiff agreed for the same and the terms of the agreement were reduced into writing on a non-judicial stamp paper of Rs.20/- on 16.02.2018. The defendant signed on the said agreement in the presence of witnesses and agreed to repay the amount with interest as and when demanded. 3. The contention of the plaintiff was that the defendant paid interest till the month of December, 2018 as agreed and thereafter failed to pay the same, as such, the plaintiff got issued a legal notice dated 12.04.2021 demanding the defendant to discharge the entire debt. The defendant gave a reply on 04.05.2021 demanding to supply the photocopy of the pro-note. Accordingly, the plaintiff furnished the copy of the pro- note on 26.05.2021, but as the defendant failed to respond to the same nor paid any amount, filed the suit for recovery of money of Rs.20,30,000/-, on the principal amount of Rs.14,00,000/- by calculating interest @ 18% per annum from January, 2019 to July, 2021 to an amount of Rs.6,30,000/-. 4. The defendant filed written statement denying purchase of the land from the plaintiff and also the execution of the document as stated by the plaintiff. He denied that the signature on the document belonged to him. He also further contended that the suit was barred by limitation. 5. The trial court on framing the issues, had taken the matter for trial. He denied that the signature on the document belonged to him. He also further contended that the suit was barred by limitation. 5. The trial court on framing the issues, had taken the matter for trial. 6. The plaintiff filed her evidence affidavit and got filed the alleged agreement dated 16.02.2018 to mark the same as an exhibit. The defendant took an objection for marking the said document contending that it was a bond, but not a promissory note and that necessary stamp duty was not paid upon it. 7. The trial court, on hearing both the learned counsel appearing for the parties and taking into consideration the citations relied by both the parties, considered the document as a promissory note and marked the same as Ex.A4. 8. Aggrieved by the said order passed by the trial court in holding the document as a promissory note, the defendant preferred this revision. 9. Heard Sri K. Sai Teja the learned counsel representing Sri P. Ananth Aathreya, learned counsel on record for the revision petitioner and Sri Ch. Srinivasulu, learned counsel for the respondent. 10. Learned counsel for the petitioner contended that the document dated 16.02.2018 was primarily acknowledging due amount under a real estate transaction. The said document dated 16.02.2018 was not a promissory note as alleged and found by the trial court but an acknowledgment of debt with a condition to pay with interest as and when demanded. Merely because there was the word ‘demand’ in the document, it could not be considered as a promissory note. The document had to be read as a whole to decide the nature of the document. As per the pleadings, the amount was lent but as per the document, the amount was due to be paid. The document dated 16.02.2018 had to be stamped with higher stamp duty payable on it. The trial court failed to see that when the document was named as an ‘agreement’ and there was an agreement to pay interest and amount was said to be due under an earlier transaction and attested by witnesses, it could not be termed as a promissory note. The trial court failed to see that when the document was named as an ‘agreement’ and there was an agreement to pay interest and amount was said to be due under an earlier transaction and attested by witnesses, it could not be termed as a promissory note. The trial court failed to see that the document dated 16.02.2018 was an acknowledgment of debt/bond and has to be charged with higher stamp duty and prayed to set aside the order dated 20.01.2025 passed by the learned Senior Civil Judge, Suryapet in O.S. No.22 of 2021. 11. The learned counsel for the respondent-plaintiff, on the other hand, contended that the petitioner-defendant received an amount of Rs.14,00,000/- from the respondent and promised to pay the said amount with interest @ 18% per annum. The document contains all the ingredients of a promissory note as defined under Negotiable Instruments Act. The petitioner taking advantage of the respondent’s innocence, health condition, old age, was dragging the matter unnecessarily. Having received the principal and paid part payment, he was now disputing taking the amount with a malafide intention and approached the Court with unclean hands with an intention to evade payment due to the respondent and prayed to dismiss the CRP. 12. Perused the record and the disputed document. 13. The disputed document is titled as an “agreement”. It was dated 16.02.2018. It was alleged to be executed by the defendant. The names of the persons, who executed the document and the person on whose behalf the document was executed were also mentioned in the document. It was also specified with regard to the nature of the document that the executant had agreed to purchase Acs.2.05 gts., of land belonging to Smt. Jakkula Vijaya Lakshmi (plaintiff) in Sy. No.301aa and 300aa, located in Reddygudem Village, Maddirala Mandal for a sale consideration of Rs.25,00,000/- per acre and out of the said amount, he gave the amount other than Rs.14,00,000/- and for the balance amount of Rs.14,00,000/-, agreed to pay interest @ Rs.1.50 ps., per month and that he would repay the same as and when demanded. It was alleged to be signed by the defendant in the presence of two witnesses. 14. It was alleged to be signed by the defendant in the presence of two witnesses. 14. Section 4 of the Negotiable Instruments Act, 1881 defines a ‘promissory note’ as an instrument in writing containing an unconditional undertaking to pay a certain sum of money to a certain person or to the bearer, on demand or at a fixed time signed by the maker. The title of the document is not decisive to decide the nature of the document. The contents of the document need to be looked into to decide the nature of the document. As the contents of the document would disclose that for the amount of Rs.14,00,000/- liable to paid by the defendant, he agreed to pay the same with interest @ Rs.1.50 ps., per month and agreed to repay the same as and when demanded by the plaintiff. As such, the document would disclose that there was an unconditional promise to repay a fixed amount on demand by the plaintiff which was signed by the borrower. As such, the document would comply the ingredients of the promissory note. 15. A bond is defined under Section 2 (5) of the Indian Stamp Act, 1899 as a written instrument whereby a person obliges himself to pay money to another on condition that the obligation shall be void if a specified act is performed. As such, there must be a conditional obligation to pay and the same was not necessarily negotiable. The document does not appear to have any conditionality or penalty clause typically found in the bonds. 16. However, the document was executed on a non-judicial stamp paper of Rs.20/-. The stamp duty payable for a promissory note is prescribed in Schedule 1-A of the Indian Stamp Act, 1899, as applicable to Telangana is Rs.1/- for every Rs.1,000/- or part thereof payable otherwise than on demand. The stamp duty must be paid at the time of execution of document. Failure to do so will result in a penalty. For an amount of Rs.14,00,000/-, the duty payable will be Rs.1,400/-. As the agreement was executed on a non-judicial stamp paper which was an under-stamped instrument, the same could not have been admitted in evidence by the court below without payment of the deficit stamp duty and penalty. The objections as to the stamp duty have to be decided then and there and could not be postponed to a subsequent stage. As the agreement was executed on a non-judicial stamp paper which was an under-stamped instrument, the same could not have been admitted in evidence by the court below without payment of the deficit stamp duty and penalty. The objections as to the stamp duty have to be decided then and there and could not be postponed to a subsequent stage. The trial court though rightly considered the nature of the document as a promissory note, failed to direct the plaintiff to pay the necessary stamp duty on the document along with penalty. The observation of the trial court that the objections could be decided at the time of arguments, is not permissible. As the same was erroneous and was not in accordance with law, the order of the trial court is liable to be set aside on this ground. 17. In the result, the Civil Revision Petition is allowed setting aside the order dated 20.01.2025 passed in O.S. No.22 of 2021 by the Senior Civil Judge, Suryapet in marking the disputed document as Ex.A4 and directed the same to be impounded and to collect necessary stamp duty and penalty on the same and to mark it as an exhibit only after payment of the deficit stamp duty and penalty. No order as to costs. Miscellaneous Applications pending, if any, shall stand closed.