Allowed

Kuppusamy Gounder v. Perumal

Madras HC13 Apr 2017SA/1111/2011

Case brief

AI extract

What is this about?

In this second appeal regarding recovery of money on promissory notes, the High Court held that where the defendant admitted execution of the notes and borrowing, the appellate courts erred in doubting the execution. Relying on Section 118 of the Negotiable Instruments Act, the Court allowed the appeal, set aside lower judgments, and decreed the suit.

What did the court decide?

The judgment and decree of the Courts below are set aside and the suit O.S.No.64 of 2008 is decreed as prayed for. No costs.

Kuppusamy Gounder Vs Perumal — Contract and Commercial Disputes | Madras HC (2017)

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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DATED: 13.04.2017

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Coram:

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The Hon'ble Mr. Justice S.VAIDYANATHAN

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Second Appeal No.1111 of 2011

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Kuppusamy Gounder .. Appellant/Appellant/Plaintiff

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vs.
Perumal ... Respondent/Respondent/Defendant
Second Appeal filed under Section 100 C.P.C. against the
judgment and decree dated 06.04.2011 in A.S.No.92 of 2010 on the
file of the Principal District Judge, Villupuram confirming the
judgment and decree of the Principal Subordinate Judge,
Tindivanam in O.S.No.64 of 2008, dated 02.09.2010.
For Appellant .. Mr.A.K.Kumarasamy
For Respondent .. No appearance
J U D G M E N T

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The plaintiff, who lost before both the Courts below is the appellant herein. The defendant before the Courts below is the respondent herein.

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The appellant/plaintiff instituted a suit in O.S.No.64 of 2008 on the file of the Principal Subordinate Judge, Tindivanam for recovery of money directing the respondent/defendant to pay a sum of Rs.2,13,792/- due on Promissory Notes 'A' and 'B', dated 10.06.2005 with subsequent interest and costs from the date of plaint till the date of realization.

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It is the case of the appellant/plaintiff that on 10.06.2005, the respondent/defendant borrowed a sum of Rs.1,26,400/- from the appellant/plaintiff and in lieu of that debt, he executed plaint 'A' promissory Note, agreeing to repay

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the amount with interest at 12% per annum to the plaintiff. Also, on the same date, the respondent/defendant borrowed a sum of Rs.30,800/- from the plaintiff's wife Vanaja Ammal and in lieu of that debt, he executed plaint 'B' promissory note agreeing to repay the principal amount with interest at 12% per annum. Since the respondent/defendant failed to repay the principal amount and interest, on 01.06.2008, the appellant/plaintiff, by paying the consideration amount, made over the plaint 'B' promissory note in his favour. Since the respondent/defendant failed to satisfy the amount borrowed on the basis of 'A' and 'B' promissory notes despite demand, the appellant/plaintiff instituted a suit against him.

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While so, according to the respondent/defendant, he did not borrow any amount on the said date and the said two promissory notes were also not executed in favour of the appellant/plaintiff and his wife. The appellant/plaintiff is engaged in money lending business at higher rate of interest. About ten years back, the respondent/defendant borrowed a sum of Rs.20,000/- from the appellant/plaintiff for his urgent necessity and in lieu of that, he executed a promissory note in his favour. As and when the respondent/defendant settles the entire interest, the appellant/plaintiff used to get fresh promissory note in his favour. In the year 2005, the appellant/plaintiff got two promissory notes from the respondent/defendant after obtaining interest, one in his favour and another in the name of his wife. According to the respondent/defendant, the plaintiff has fabricated the promissory note and laid a false suit, when, in fact, no amount was due from the defendant to the plaintiff. It is the case of the respondent/defendant that the plaintiff failed to return back the promissory notes despite settlement of amount due to him.

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The Trial Court, after analyzing the available oral and documentary evidence, dismissed the suit in favour of the respondent/defendant. Aggrieved by the same, the appellant/plaintiff herein preferred an appeal in A.S.No.92 of 2010 on the file of the Principal District Court, Villupuram. By a judgment dated 06.04.2011, the First Appellate Court dismissed the appeal with costs, thereby, confirming the judgment of the Trial Court.

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The only substantial question of law that arises for consideration in this case is as follows:

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“Whether the appellant/plaintiff has not proved his means to advance money under Exs.A1 and A2?”

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Heard the learned counsel for the appellant/plaintiff. It is his contention that the Courts below failed to see that the burden of proof regarding passing of consideration as well as the discharge of suit promissory notes is upon the respondent/defendant and hence, the dismissal of the suit by wrongly placing the burden of proof on the appellant/plaintiff is totally erroneous.

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It is seen that the respondent/defendant in his evidence has admitted that he had executed a Promissory Note in the year 1999 after receiving a sum of Rs.20,000/- towards his daughter's marriage and that once in three years, he used to execute a new Promissory Note for the dues towards interest. He also admitted that in the year 2005, he executed two Promissory Notes on the same day, one in favour of the appellant/plaintiff and the other in favour of his wife. There is also a clear pleading in the plaint that the appellant/plaintiff owed a sum of Rs.1,26,400/- to the respondent/defendant and the respondent/defendant executed a Promissory Note agreeing to pay interest at 12% per annum.

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Though the Trial Court as also the First Appellate Court agreed with the fact that the respondent/defendant received money from the appellant/plaintiff, unfortunately, both the Courts below have held that the execution of Promissory Notes vide Exs.A1 and A2 is doubtful.

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It may be correct on the part of the respondent/defendant to contend that unless and otherwise consideration has been passed on, Promissory Note could be a doubtful one. But, in this case, borrowal of money as also execution of Promissory Notes in favour of the appellant/plaintiff is accepted by the respondent/defendant. That being the case, the Courts below ought not to have rendered a finding against the appellant/plaintiff, as it falls under Section 118 of the Negotiable Instruments Act.

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Thus, taking note of the evidence of D.W.1, who has accepted in his evidence before the Trial Court about the borrowal of money from the appellant/plaintiff as also the execution of Promissory Note in favour of the appellant/plaintiff, the finding of the Courts below that the execution of Promissory Notes is doubtful, cannot be accepted. Accordingly, the substantial question of law is answered in favour of the appellant/plaintiff.

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Hence, I am of the view that the finding of both the Courts below has got to be interfered with. Accordingly, the

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judgment and decree of both the Courts below are set aside and the Suit filed by the appellant/plaintiff in O.S.No.64 of 2008 is decreed as prayed for. In fine, the Second Appeal is allowed. No costs.

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Sd/-
Assistant Registrar(CS II)
//True Copy//
Sub Assistant Registrar
Aeb
To
1. The Principal District Judge, Villupuram.
2. The Principal Subordinate Judge, Tindivanam.
+1cc to Mr.A.K.Kumarasamy, Advocate, S.R.No.22664
S.A. No.1111 of 2011
ev(co)
rmp(05/05/17)

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Kuppusamy Gounder v. Perumal

Case brief

What is this about?

What did the court decide?

Kuppusamy Gounder v. Perumal

Case brief

What is this about?

What did the court decide?

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