Allowed

S.Gopalakrishnan Nair v. C.S.Haridasan

Kerala HC6 Feb 2020RFA/61/2005

Case brief

AI extract

What is this about?

This appeal challenged a suit for realization of a sum money dismissed by the trial court. The High Court allowed the appeal, holding that the defendant failed to rebut the presumption of consideration under Section 118 of the Negotiable Instruments Act as his defenses were not substantiated by specific pleadings or cogent evidence.

What did the court decide?

O.S.No.112 of 2000 allowed; decree passed permitting realization of Rs.1,70,000 with interest at 6% p.a.

S.Gopalakrishnan Nair Vs C.S.Haridasan — Cheque Dishonour | Kerala HC (2020)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MRS. JUSTICE MARY JOSEPH

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THURSDAY, THE 06TH DAY OF FEBRUARY 2020 / 17TH MAGHA, 1947

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RFA.No.61 OF 2005(A)

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AGAINST THE JUDGMENT AND DECREE DATED 19.12.2003 IN O.S.NO.112/2000 OF ADDITIONAL SUB COURT, ALAPPUZHA

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APPELLANT/PLAINTIFF:

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G.GOPALAKRISHNAN NAIR, S/O. GOPALA PILLAI, AGED 65 YEARS, ARAKKAL HOUSE, KANNADI P.O., PULIKUNNU, ALAPPUZHA, REPRESENTED BY HIS POWER OF ATTORNEY HOLDER VIJAYAKUMAR, S/O. PURUSHOTHAMAN, AGED 47 YEARS, ARAKKAL, KANNADI P.O, PULIKUNNU, ALAPPUZHA

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BY ADVS. SRI.K.S.HARIHARAPUTHRAN SRI.GEORGE MATHEW

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RESPONDENT/DEFENDANT:

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C.S.HARIDASAN, AGED ABOUT 42 YEARS, VAKKADE HOUSE, PARUTHIPARA, KUMARANELLOOR P.O., VADAKKENCHERRY, THRISSUR.

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BY ADVS. SRI.N.MANOJ KUMAR SMT.JAYASREE MANOJ

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THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 15-10-2019, THE COURT ON 06-02-2020 DELIVERED THE FOLLOWING:

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R.F.A. No.61 of 2005 2

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MARY JOSEPH, J.

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R.F.A.No.61 of 2005

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Dated this the 6^th day of February, 2020

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JUDGMENT

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The appellant is the plaintiff in O.S.No.112 of 2000, a suit for realisation of Rs.1,70,000/- with interest at the rate of 18% per annum from the defendant. The suit was dismissed by the Additional Sub Judge, Alappuzha vide judgment dated 19.12.2003. The plaintiff is aggrieved thereby and therefore, the appeal on hand is filed.

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The transaction pleaded in the plaint was borrowal of Rs.1,70,000/- by the defendant from the plaintiff at the latter's residence at Kuttanad, on 20.07.1999. As per the pleading a post dated cheque (bearing date 20.03.2000) was given by the defendant on the date of borrowal. The cheque was presented before the Bank by the plaintiff, but not encashed due to insufficiency of funds in the account of the defendant. Memo was issued by the Bank informing the

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factum of dishonour of the cheque for the reason. A lawyer notice was received by him on 12.06.2000, but was not responded by repayment of money covered by the cheque. Therefore, the suit was filed.

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In the written statement filed by the defendant the pleadings of the plaintiff regarding the visit of the defendant at the residence of the plaintiff at Kuttanad on 20.07.1999 and borrowal of Rs.1,70,000/- was denied. The issuance of the post dated cheque for Rs.1,70,000/- on 20.07.1999 itself was also denied. It is contented that the defendant did not have any idea about the location of plaintiff's residence, that he has never gone to Kuttanadu where the house of the plaintiff is allegedly situated, and that he had never met the plaintiff after returning to his native place at Trichur from Qatar in the year 1999. The cheque was allegedly obtained fraudulently by the plaintiff from the defendant about 9 years' back at Qatar and forging signatures and writings therein, the prosecution was launched with a view to make unlawful gain. It was also contented that the defendant had purchased a property from the wife of one Mr.Ramachandran, a resident of Qatar for

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sometime and a friend of him and the suit was filed in collusion and in connivance with him.

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During trial, the plaintiff examined himself as PW1 and his nephew was examined as PW2. Exts.A1 to A4(b) were marked in evidence. Defendant examined himself as DW1 and Exts.B1 to B4 were also marked.

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The trial court on appreciation of the evidence found that the evidence adduced by the defendant is more probable than that of the plaintiff and accordingly, dismissed the suit.

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According to Sri. Hariharaputhran, the learned counsel for the appellant, the finding of the trial court is wrong. According to him, the plaintiff has established his case successfully by oral as well as documentary evidence adduced

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by him. Plaintiff as PW1 has categorically deposed in tune with his pleadings in the plaint. He was confronted on several aspects like location of his residence at Kuttanad and stay there during 1999, the place where the transaction of borrowal of money had taken place and his source of income to advance Rs.1,70,000/-.

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According to Smt.Jayasree Manoj, the learned counsel for the defendant, in order to rebut the presumption, the defendant needs only to bring forth some preponderance of probabilities in the evidence adduced by the plaintiff and in the case on hand, he has succeeded in his venture. According to her, it has come out during cross examination that PW1 has not resided at Kuttanad in the year 1999. According to her, the plaintiff failed to produce any cogent materials to establish that he has residence at Kuttanad during 1999 and therefore the case of the plaintiff that Rs.1,70,000/- was advanced and a post dated cheque was issued at his residence at Kuttanad towards discharge of the debt is improbalised. The learned counsel has relied on Narayana Menon V. State of Kerala [2006 (3) KLT 404 (SC)] to base her stand that the defendant has only to discharge the initial burden of proof and is not required to disprove the plaintiff's case and on discharging the initial burden, the presumption disappears and the burden shifts to the opposite side. The learned counsel has also relied on D.M.Deshpande and Others v. Janardhan Kashinath Kadam and others [(1998) 8 SCC

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315] wherein it was held that pleadings must be raised by a party with reference to all necessary and material facts in support of his case and if he desists from raising the required pleas, the evidence adduced on those aspects will be of no relevance.

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John K. Abraham v. Simon C. Abraham [2014(1)

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KLT 90 (SC)] has been cited by the learned counsel to contend that the burden is upon the plaintiff to show that he had the required fund for advancing the money to the defendant.

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In the backdrop of the argument advanced as above the evidence on record is evaluated. According to PW1, the defendant who was available locally in the year 1999, visited him at his residence at Kuttanadu demanding Rs.2,00,000/and Rs.1,70,000/- available with him was given. A signed

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post dated cheque was also given. It is true that the signature and writings in the cheque were alleged in the written statement as forged by the defendant, but during cross examination it was admitted as affixed by him. According to the defendant, he had returned from gulf on 08.04.1999. Therefore, the factum that defendant was

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available locally in the year 1999 is established. The alleged borrowal of the amount was on 20.07.1999. According to the defendant, the fact that PW1 has his residence at Kuttanadu and money was advanced to him therefrom are only falsehood and PW1 was confronted on the matter. But, the stand of PW1 was consistent that he had a house there and cash available with him was given to the defendant when he visited the place. During cross examination PW1 had admitted that he has a residence at Kuttanandu and had stayed at Vaikom and Aluva for some period. It was contended that the plaintiff failed to produce any materials to establish that he had resided at Kuttanadu. But, when confronted with, PW1 had stated that his name was registered in the N.S.S Sakha at Kuttanadu and he has also postal correspondence there. An account was also stated as maintained by him at Pulinkunnu Branch of Canara Bank for drawing pension. When confronted specifically about the time of registration of his name at N.S.S. Sakha, PW1 has also stated that registration relates back to the date of his marriage. According to him, apart from the documents referred to, other materials are not available with

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him. Though plaintiff had spoken that the relevant documents referred to, he was not asked to produce those. It is pertinent to note from a glance at the written statement that pleadings with reference to the matters confronted with were not taken in the written statement. The only contention in the written statement was that the place where the plaintiff's house at Kuttanad was located is not known to the defendant and he had never been to there.

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In the context, D.M.Deshpande supra cited by Sri.Hariharaputhran has relevance. It was a case wherein execution proceedings was resisted raising claim for tenancy rights and the Apex Court held that all facts necessary and material should be pleaded by the party in support of the case set up by it. The dictum contained in Para 9 is extracted hereunder:-

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“9. xx xx The object and purpose of a pleading is to enable the adversary party to know the case of the opponent. In order to have a fair trial, it is imperative that the parties should state the essential material facts so that the other party may not be taken by surprise. The Court has, however, cautioned against a pedantic approach to the problem and has directed that the court must ascertain the substance of the pleading and not the form, in order to determine the case. The respondents have emphasised latter observations. In the present case, however, no material in support of the plea of tenancy has been set up anywhere in any form. In the case of Nilesh Construction

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Co. v. Gangubai the Court observed that before a reference to the Mamlatdar for deciding the issue of tenancy under the Bombay Tenancy and Agricultural Lands Act, 1948 is made, the alleged tenant must disclose in his pleadings, details about the tenancy and the exact nature of the right which is claimed by him. An issue of tenancy cannot be raised on a vague plea.”

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The version of PW1 was that though Rs.2,00,000/was demanded, only Rs.1,70,000/- was advanced, since that alone was available with him. Admittedly, PW1 was abroad for a long period and was engaged in money lending dealings. The factum was also conceded by the defendant. Therefore, there is no reason to doubt the availability of money with him and PW1 was not questioned by the defendant on the source of his income to advance Rs.1,70,000/-. PW2 has spoken that he was available at PW1's house when the money was advanced to the defendant. According to PW2, money was given in cash. The contention of the learned counsel for the defendant was that PW2 being an interested witness, his version cannot be believed at all. It is true PW2 is the nephew of PW1. But, he survived the lengthy cross examination by the defendant without his credence being lost. On a scrutiny of his evidence with caution, circumstances to doubt the credibility of his version was also not brought out. Therefore,

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there is no scope for even entertaining a doubt on the plaintiff's success in establishing that Rs.1,70,000/- was

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borrowed from him by the defendant and the cheque in question was issued towards discharge of the liability. In the said circumstances, Section 118 N.I. Act could safely be drawn to the context.

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Section 118 N.I Act reads:

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“118. Presumptions as to negotiable instruments.

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Until the contrary is proved, the following presumptions shall be made:—

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(a) of consideration —that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, endorsed, negotiated or transferred, was accepted, endorsed, negotiated or transferred for consideration;

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(b) as to date —that every negotiable instrument bearing a date was made or drawn on such date;

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(c) as to time of acceptance —that every accepted bill of exchange was accepted within a reasonable time after its date and before its maturity;

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(d) as to time of transfer —that every transfer of a negotiable instrument was made before its maturity;

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(e) as to order of endorsements —that the endorsements appearing upon a negotiable instrument were made in the order in which they appear thereon;

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(f) as to stamps —that a lost promissory note, bill of exchange or cheque was duly stamped;

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(g) that holder is a holder in due course —that the holder of a negotiable instrument is a holder in due course:

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PROVIDED that, where the instrument has been obtained from its lawful owner, or from any person in lawful custody thereof, by means of an offence or fraud, or has been obtained from the maker or acceptor thereof by means of an offence or fraud, or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him.”

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Section 118 says, until it is disproved, the presumption that the cheque has been received by the plaintiff for a consideration will remain. The legislative intent while incorporating Section 118 in the N.I. Act was that once the issuance of a signed cheque was established as towards discharge of the debt, the presumption that the cheque was issued for consideration itself will operate and that presumption will be available till the contrary is proved reliably by the defendant.

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As already stated, the defendant had adduced his oral evidence as DW1 and marked Exts.B1 to B4. During examination DW1 has spoken that the cheque given by him to one Mr.Moidu was retained by PW1 and misusing the same, the suit in question was filed. But, the evidence tendered to the effect can only be taken as an exaggerated version for his failure to take a pleading with reference to that in the written statement. Paragraph 6 of the written statement being relevant in the context is extracted :

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“6. It is submitted that the defendant had never issued the alleged cheque to the plaintiff. The signature in the cheque and the writings could be one that has been forged by the plaintiff himself. The alleged cheque could be

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one which might have been fraudulently obtained by the plaintiff about 9 years back at Khathar and the attempt, it appears, is only to make unlawful gain over this defendant. The plaintiff is liable for the offence for forgery and theft, as the case may be, which would be revealed at the time of trial.” (emphasis supplied)

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Paragraph 10 of the written statement being relevant is

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also extracted:

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“10. Plaintiff filed the above suit in connivance and collusion with one Ramachandran from who's wife the defendant had purchased the plaint schedule property said Ramachandran was also in Quator for some years with plaintiff and defendant and he is a close friend of the plaintiff. This defendant never borrowed any amount from the plaintiff. The plaintiff had no need to borrow money from any body. The above suit is devoid of any merits. The suit is liable to be dismissed. ”

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The cheque is not disowned by the defendant. The signature and writings therein were alleged as forged by the plaintiff, but lateron during the course of trial, he had admitted the signature as affixed by him. It is clear from the above extract that the defendant has no definite idea on the manner in which the cheque drawn from his account reached the hands of the plaintiff for the misuse alleged by him.

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It is surprising to note from the evidence tendered by DW1 that he had spoken about several aspects with a view to discharge his onus of rebuttal of presumption. As stated earlier, mere adducing of evidence without specific pleading being raised, can only be treated as an exaggerated version. In the case on hand the defendant had alleged forgery and theft as the reasons behind the reach of his cheque at the hands of the plaintiff. However, these two contentions cannot go together.

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Yet another factum sought to be established by DW1 during examination was that the amount borrowed from him by one Mr.Sreekumar was repaid and the cheque obtained as security from him at the time when the money was advanced was retained even after discharge of the debt and was misused. The above story being spoken by the defendant for the first time while tendering evidence and being not based on pleadings taken in the written statement filed by him it is only to be discarded outrightly. The defendant had also tendered oral evidence that a property was purchased by him from one Mr.Ramachandran, in respect of which an order of

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attachment before judgment was obtained by the plaintiff in the case on hand and for some disputes that arose during its registration among himself and the said Ramachandran, the latter colluded with the plaintiff to file the suit on hand against him with the cheque obtained by him, 9 years back. The above factum sought to be established has the support of pleadings, but it was denied by the plaintiff. The defendant failed to tender any independent evidence to substantiate that and therefore, it is not worthy of reliance and only to be discarded.

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The defendant in his written statement has also taken a stand that the cheque might have been stolen or obtained by the plaintiff fraudulently. There must be definite pleadings in the written statement while taking those as defences as held by the Apex Court in D.M.Deshpande supra . When such pleas are taken, the burden is purely on the defendant to establish those by adducing cogent and independent evidence. If the defendant has a case that his cheque was stolen by the plaintiff, as a prudent man, he must have resorted to set the law in motion. It is noted that the defendant does not have such a case and evidence was also not adduced in that regard.

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Therefore, in the case on hand, there was total failure of defendant to adduce evidence on the basis of the pleadings taken in the written statement. He had adduced some evidence but, for the reason that it does not have the basis in the pleadings raised by him is unreliable. Evidence adduced without the support of any precise pleadings raised in the written statement, will not have any evidentiary value and is liable to be discarded.

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As rightly pointed out by the learned counsel for the defendant, the burden of proof of the defendant is only to draw some preponderance of probabilities in plaintiff's case and not to disprove his case in it's entirety. The defendant in the case on hand failed to discharge his onus of rebutting the presumption either by bringing forth preponderance of probabilities in the evidence stands adduced by the plaintiff in the process of cross examining him or by adducing independent affirmative evidence on contentions taken by him.

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Therefore, there is absolutely no basis for the defendant to contend that the presumption under Section 118 N.I Act was rebutted by him successfully. The trial court is

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undoubtedly erred in holding that the plaintiff's case is much improbabilised and that the case of the defendant appears

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probable. The trial court ought to have taken the case of the plaintiff as proved and allowed the suit.

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In the result, the appeal is allowed. The judgment under challenge is set aside. O.S.No.112 of 2000 is allowed and a decree is passed permitting the plaintiff to realise Rs.1,70,000/- with interest at the rate of 6% per annum from the date of the suit till realisation and proportionate costs, from the defendant.

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MARY JOSEPH, JUDGE

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NAB/ttb

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//TRUE COPY//

S.Gopalakrishnan Nair v. C.S.Haridasan

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S.Gopalakrishnan Nair v. C.S.Haridasan

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