Polareddy Krishna Prasad Reddy Vs Allareddy Venkata Subbareddy @ Allamreddy Venkata Subbareddy

Appeal under section 100 of C.P.C, aggrieved by the^{judgmentanddecree} made in A.S No.26 of 2004 dated 03.11.2005 on the file of the Principal District Judge, Nellore confirming the judgment and^{DecreeinO.S.No.177} of 2001 dated 18.11.2003 on the file of the Additional Senior Civil Judge, Nellore.

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This appeal coming on for hearing and upon perusing^thegroundsof appeal, the judgment and Decree of the Lower Court^{andmaterialpapers} in the Suit and upon hearing arguments of Sri. P Sridhar^{Reddy,Advocate} for the Appellant and of Sri G Vijaya Saradhi, Advocate^{forRespondent.}

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This Court doth Order and decree as follows:

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That the Second Appeal be and is hereby dismissed; 2. That the Judgment dated 03.11.2005 of the District Judge, Nellore in A.S No.26 of 2004 be and hereby stands confirmed and

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That there be no order as to costs in this appeal.

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SD/- V DIWAKAR DEPUTY EGISTRAR

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//TRUE COPY//

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SECTION OFFICER

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To

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The Principal District Judge, Nellore, SPSR Nellore District

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The Additional Civil Judge(Senior Division),Nellore, SPSR Nellore District

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Two CD copies

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HIGH COURT

DATED: 01/01/2025

05FE3 2025 J ^ Currenv section

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DECREE

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SA.No.1212 of 2008

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DISMISSING THE SECOND APPEAL WITHOUT COSTS

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IN THE HIGH COURT OF ANDHRA PRADESH :: AMARAVATI

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THURSDAY ,THE SECOND DAY OF JANUARY

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TWO THOUSAND AND TWENTY FIVE

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PRESENT

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HON’BLE SRI JUSTICE T MALLIKARJUNA RAO

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SECOND APPEAL NO: 1212 OF 2008

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Appeal under section 100 of C.P.C, aggrieved by the judgment and decree made in A.S No.26 of 2004 dated 03.11.2005 on the file of the Principal District Judge, Nellore confirming the judgment^and Decree in O.S. No.177 of 2001 dated 18.11.2003 on the file of the Additional Senior Civil Judge, Nellore.

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Between:

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Polamreddy Krishna Prasad Reddy, S/o.Eswar Reddy, aged about 57 years, R/o.12, Viswanathapuram, 3rd Street, Chennai,^Tamilnadu.

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...Appellant/ Appellant/Defendant

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AND

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Allareddy Venkata Subbareddy @ Allamreddy Venkata Subbareddy, S/o.Subba Rami Reddy, aged about 67 years, R/o.Nellore^Town.

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...Respondent/ Respondent/Plaintiff

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Counsel for the Appellant: Sri. P Sridhar Reddy

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Counsel for the Respondent: Sri G Vijaya Saradhi

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The Court made the following: JUDGMENT

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APHC010066042008

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IN THE HIGH COURT OF ANDHRA PRADESH

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AT AMARAVATI

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[3369]

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(Special Original Jurisdiction)

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THURSDAY, THE SECOND DAY OF JANUARY TWO THOUSAND AND TWENTY FIVE

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PRESENT

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THE HONOURABLE SRI JUSTICE T MALLIKARJUNA RAO

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SECOND APPEAL NO: 1212/2008

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Between:

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Polareddy Krishna Prasad Reddy

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...APPELLANT

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AND

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Allareddy Venkata Subbareddy Allamreddy Venkata Subbareddy

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...RESPONDENT

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Counsel for the Appellant:

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1.PSRIDHAR REDDY

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Counsel for the Respondent:

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1.G VIJAYASARADHI

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The Court made the following JUDGMENT:

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This Second Appeal, under section 100 of Code of Civil Procedure, 1908 (for short, 'C.P.C'), has been filed by the Appellant/Appel^{lant/Defendant} against the Decree and Judgment dated 03.11.2005, in A.S.No.26 of 2004 on the file of District Judge, Nellore (for short, ‘the 1®' Appellate Court’) reversing the decree and Judgment dated 18.11.2003, in O.S.No.177 of 2001 on the file of Additional Senior Civil Judge, Nellore (for short, ‘the trial Court’). 2. The Respondent/Respondent is the Plaintiff, who filed the suit in O.S.No.177 of 2001 seeking recovery of Rs.1,42,500/- being the principal and interest from the Defendant based on the promissory^note.

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Referring to the parties as they are initially arrayed in the suit is practical to mitigate confusion and better comprehend the case.

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The factual matrix, necessary and germane for adjudicating the contentious issues between the parties inter se, may^{bedelineatedasfollows;} This suit has been filed for the recovery of Rs.1,42,500/-,^basedon a promissory note executed by Defendant in favour of^Plaintifffor Rs.75,000/- on 03.06.1998. The Defendant agreed to repay the amount with interest at 30% per annum. Despite several demands, the Defendant has failed to pay the principal and interest.^The Defendant is not entitled to the protections under^ActIVof1938.

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In the written statement. Defendant admits borrowing Rs.75,000/- from Plaintiff on 03.06.1998 for agricultural purposes, not business, and executing a promissory note with 30% interest. He claims to have^{settledthedebtunder} the suit promissory note and another for Rs.60,000/- (dated 06.10.1997) by paying Rs.1,50,000/-, for which the Plaintiff issued a receipt on 08.09.1999. The Defendant paid interest for both loans but failed^tocontinue after three months. On 01.08.1999, Plaintiff agreed to accept Rs.1,50,000/-^towardsfull settlement, and the payment was made through J. Subrahmanyam Reddy. However, the Plaintiff did not return the promissory notes, citing they were at a relative’s house in Koduru. The Defendant, an agriculturist^{withAc.4.00cents} of land, seeks relief under Act IV of 1938, requesting^{theinterestbereduced} to 12% per annum. Therefore, the Defendant seeks dismissal^ofthesuit.

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Based on the above pleadings, the trial Court has framed the following issues:

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/. Whether the>discharge pleaded by the Defendant is^true,and binding on the Plaintiff?

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a. Whether the interest claimed is excessive and liable to be scaled down?

Hi. To what relief?

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During the trial, PW.1 was examined and marked Ex.A.1 on behalf of the Plaintiff. Conversely, DWs.1 and 2 were examined on behalf of the Defendant, and Ex.B.1 was marked.

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After completing the trial and hearing the arguments of both sides, the trial Court decreed the suit with costs for Rs. 1,42,500/- with interest at 30% per annum on Rs.75,000/- from the date of suit till the date of decree and thereafter at 6% per annum till realization.

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Aggrieved by the same, the Defendant filed an Appeal^{inA.S.No.26of} 2004 on file of the 1®* Appellate Court. The 1®* Appellate Court, being the final fact-finding Court, framed the following point for^{consideration:}

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/. Whether the discharge pleaded by the Defendant is^true?

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a. Whether the interest claimed by the Plaintiff is^excessive?

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Hi. Whether the Judgment and decree passed by the learned Senior Civil Judge legal and sustainable?

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iv. To what relief?

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The 1®‘ Appellate Court, after scrutinizing the oral and documentary evidence adduced on behalf of both parties, allowed the Appeal by its Judgment, and decree dated 03.11.2005. The 1®‘ Appellate^{Courtmodifiedthe} trial Court's decree, awarding the Plaintiff Rs.75,000/- with interest at 18% per annum from 03.06.1998 until the date of the suit, followed by 12% per annum interest from the suit date to the decree date, and 6% per annum thereafter until realization. The Plaintiff is entitled to proportionate costs as awarded by the trial Court. Assailing the same, the Defendant preferred the present Second Appeal.

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H. Heard Sri. P. Sridhar Reddy, learned Counsel representing the Appellant / Defendant, and Sri G. Vijaya Saradhi, learned Counsel representing the Respondent / Plaintiff.

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Learned Counsel for the Appellant argued that the Courts^belowfailed to consider the Plaintiff’s admission in cross-examination of receiving Rs.1,50,000/under Ex.B1, paid by DW2 on behalf of the Defendant, warranting dismissal of the suit. The Courts below also erred in linking Ex.BI to a different loan transaction, as no supporting evidence was provided. The Plaintiffs acknowledgement of Defendant as an agriculturist^{shouldhaveled} to a reduction in interest under the Agriculturist Debt Relief Act (4 of 1938). Moreover, the Defendant proved the discharge of the suit amount through his testimony, DW2's testimony, and Ex.BI receipt. Finally,^{bothCourtsfailedto} address the excessive and usurious interest claimed by the Plaintiff.

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Per contra, learned Counsel for the Respondent contends^thatthe 1 St Appellate Court evaluated the facts of the case and reached the correct conclusions. The reasons given by the 1®* Appellate Court do not require any modifications.

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Based on the Appellant’s contentions, the following substantial question of Law is involved in this Second Appeal:

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Whether there is any perversity of the Judgment of^theCourts below and whether the Judgments are liable to be set^aside?

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Before delving into the matter, since the Appeal is^{filedunderSec. 100} of C.P.C., this Court must see the scope of Section^100ofC.P.C.

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In H.P.Pyarejan V. Dasappa (dead) by LRs. and others^,^theHon’ble Supreme Court held that:

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Under Section 100 of the Code (as amended in 1976), the jurisdiction of the High Court to interfere with the Judgments of the Courts below is confined to hearing on substantial questions of Law. Interference with the finding of fact by the High Court is not warranted if it involves re-appreciation of evidence (see Panchugopal Barua v. Umesh Chandra Goswami (1997) 4^SCC 713) and Kshitish Chandra Purkait v. Santosh Kumar Purkait (1997) 5 SCC 438)

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2006 (3) ALT 41 (SC)

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Considerations in Section 100 of C.P.C. arise only^when there is a substantial question of Law and not mere such questions^of Law^oronebased on facts. However, it has to be borne in mind that in case of misapplication of Law and improper appreciation of evidence on record, particularly the documentary evidence, it is the bounden duty of the High Court sitting in Second Appeal to consider such questions which are substantial in terms of Law.

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In the Second Appeal, while exercising jurisdiction under Section 100 of the C.P.C., this Court must confine itself to the substantial questions of Law involved in the Appeal. This Court cannot re-appreciate^{theevidenceand} interfere with the findings of the Courts below, where the Courts below recorded the findings judicially by appreciating both oral and documentary evidence. Further, a substantial question of Law is the sine qua non for the exercise of jurisdiction. This Court cannot substitute its own opinion unless the findings of the Courts below are manifestly perverse and contrary to the evidence on record.

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The Plaintiff/Appellant in the present Second Appeal initiated the suit based on Ex.A.1, a promissory note, which allegedly was executed by the Defendant for a sum of Rs.75,000/on 03.06.1998. The Defendant purportedly agreed to repay the amount with interest at a rate of 30% per annum. In his written statement. Defendant conceded to having borrowed Rs.75,000/- on 03.06.1998 from Plaintiff, though he^{contendedthattheloan} was for agricultural purposes, not for business. Further, the Defendant raised a plea of discharge. To substantiate his stand. Defendant^{testifiedasDW.1} and examined one J. Subramanya Reddy as DW.2. Defendant relied on Ex.B.1, a receipt allegedly issued by Plaintiff for the payment of Rs.1,50,000/-. However, the Defendant admitted during his testimony^thatEx.B.1 does not specify that the amount of Rs.1,50,000/- was paid towards^thedebtunder Ex.A.1. DW.2 also conceded that Ex.B.1 fails to outline the particulars of the

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transaction or the specific debt for which the payment of Rs.1,50,000/- was made. After considering the evidence, the trial court rejected the Defendant's version and held that Ex.B.1 is not connected to Ex.A.1 and, therefore, does not carry any binding effect on the Plaintiff.

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The trial Court concluded that the Defendant is liable to pay interest at 30% per annum, noting the absence of evidence to demonstrate that the Defendant is dependent on agriculture or owns land. Aggrieved by this Judgment, the Defendant filed an appeal. The Defendant reiterated the same arguments that were advanced before the trial court. The 1®' Appellate Court carefully considered the competing arguments presented by both parties and ultimately dismissed the Appeal.

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The 1®‘ Appellate Court observed, in particular, that during crossexamination, DW.1 admitted he was unaware of the number of transactions he had held with the Plaintiff. Further, the 1®' Appellate Court pointed out that to succeed. Defendant had the burden of establishing^{thattherewerenoother} transactions between him and Plaintiff. The Appellate^Courtnoted that since 1997, the Defendant had been regularly borrowing money from the Plaintiff. 22. Additionally, the 1®* Appellate Court noted that the evidence provided by DWs.1 and 2 indicated that debt under two separate promissory notes had been settled through Ex.B.1. However, the 1®* Appellate Court emphasized that if the payment under Ex.B.1 truly represented the settlement of all outstanding liabilities, the receipt should have explicitly^statedthat all debts were fully discharged. This lack of clarity in Ex.B.1 further undermined the Defendant’s stand.

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Upon re-appreciation of the evidence, the 1®* Appellate^{Courtconcluded} that, based on Ex.B.1 receipt, it is difficult to conclude^{thatthedebtunder} Ex.A.1 promissory note had been discharged, given the numerous transactions between the parties. However, the 1®* Appellate Court did reduce

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the interest rate from 30% per annum to 18% per annum, taking into account prevailing interest rates. Although the Defendant has^{raisedanissue} in this Second Appeal regarding the interest rate reduction to 18% per annum, after considering the prevailing banking rate of interest, I find no merit in challenging the 1®* Appellate Court's Judgment.

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It is also important to note that the Appellant failed to prove that he is an agriculturist and that the loan was explicitly for agricultural purposes. Despite the Plaintiff admitting his signature on Ex.B.1 receipt, the circumstances highlighted by both the trial Court and the 1®* Appellate^Courtmake it clear that Ex.B.1 cannot be construed as being related to^{thesuittransaction.The} absence of any recital in Ex.B.1 explicitly stating that all liabilities of the Defendant had been settled further weakens the Defendant's case. Additionally, the evidence on record indicates several^{transactionsbetween} the parties, and Defendant failed to establish that Ex.B.1 receipt was issued about the suit promissory note transaction. Therefore, this Court finds no justification in the contentions raised by the Defendant.

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The findings of the fact recorded by the 1®‘ Appellate^{Courtarebased} on the appreciation of both oral and documentary evidence unless the Appellant demonstrates that substantial question of law involved in the Second Appeal, interference of this Court with the judgments rendered by the trial Court as well as the 1®‘ Appellate Court in the exercise of jurisdiction under section 100 of C.P.C., is not warranted.

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For the reasons outlined above, this Court discerns no infirmity, much less perversity or illegality, in the Judgment rendered by the learned 1 St Appellate Court. The findings and reasoning provided by the 1®‘ Appellate Court align with established legal principles. The 1 St Appellate Court meticulously reviewed all the evidence on record, omitting nothing pertinent. nor did it consider any extraneous material.

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27. Regarding the scope of section 100 CPC, the Hon’ble Apex Court in Hero Vinoth V. Seshammal^, held that:

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It is not within the domain of the High Court to investigate the grounds on which the findings were arrived at by the last Court of fact, being the first appellate Court. It is true that the lower appellate Court should not ordinarily reject witnesses accepted by the trial court in respect of credibility. Still, even where it has rejected^the witnesses accepted by the trial court, the same is no ground^{forinterferencein} second Appeal when it is found that the appellate Court has given satisfactory reasons for doing so. In a case where, from a given set of circumstances, two inferences of fact are possible, one drawn by the lower appellate Court will not be interfered with by the High Court in the second Appeal. Adopting any other approach is not permissible. The High Court will, however, interfere where it is found^that the conclusions drawn by the lower appellate Court were erroneous, being contrary to the mandatory provisions of Law applicable or its settled position on the basis of pronouncements made by the Apex Court, or w'as based upon inadmissible evidence or arrived at by ignoring material^evidence.

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The principles relating to Section 100 CPC, relevant for this case, maybe summarised thus:-

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(i)

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(ii) The High Court should be satisfied that the case involves a substantial question of Law and not a mere question of Law. A question of Law having a material bearing on the decision of the case (that is, a question, answer to which affects the rights of parties to the suit) will be a substantial question of Law if it is not covered by any specific provisions of Law or settled legal principle emerging from binding precedents, and, involves a debatable legal issue. A substantial question of Law will also arise in a contrary situation, where the legal position is clear, either on account of express provisions of Law or binding precedents, but the Court below has decided the matter, either ignoring or acting contrary to such legal principle. In the second type of case, the substantial question of Law arises not because the^{Lawisstilldebatable} but because the decision rendered on a material question^violatesthe settled position of Law.

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The Hon’ble Supreme Court in Randhir Kaur v. Prithvi Pal Singh and Ors.^, held that:

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^ AIR 2009 sc 1481

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^ MANU/SC/0974/2019

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A perusal of the judgments, as mentioned earlier,^{wouldshowthat} the jurisdiction in the second Appeal is not to interfere with the findings of fact on the grounds that findings are erroneous, however gross or inexcusable the error may seem. The findings of fact^{willalsoincludethe} findings on the basis of documentary evidence. The jurisdiction to interfere in the second Appeal is only where there^{isanerrorinLawor} procedure, not merely an error on a guestion of fact.

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In these circumstances, upon consideration of the decree and Judgment of the 1®* Appellate Court, this Court is satisfied that the arguments presented pertain solely to the factual matrix and do not involve any substantial question of Law. The Appellant has not raised any legal issues in this Second Appeal that warrant consideration. There is no sufficient ground to interfere with the Judgment of the Appellate Court. Therefore, this Second Appeal must inevitably fail.

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As a consequence, the Second Appeal is dismissed without^costs. The Judgment dated 03.11.2005 of learned District Judge, Nellore, in A.S.No.26 of 2004, stands confirmed.

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Miscellaneous petitions pending, if any, in this Appeal,^{shallstandclosed.}

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SDI- V DIWAKAR DEPUTY REGISTRAR

//TRUE COPY//

SECTION OFFICER

To