Dismissed

Anand, v. Renganathan

Madras HC2 Dec 2019AS/196/2011

Case brief

AI extract

What is this about?

First appeal against a decree in a money recovery suit. The High Court dismissed the appeal, holding that the appellant failed to substantiate his denial of the loan quantum with evidence. The court affirmed the Trial Court's finding that the alleged borrower signed an unfilled promissory note and paid interest, reinforcing the plaintiff's possession of the true loan amount.

What did the court decide?

Appeal dismissed; judgment of District Court confirmed; no order as to costs.

Anand, Vs Renganathan — Contract and Commercial Disputes | Madras HC (2019)

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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DATED: 02-12-2019

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CORAM

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THE HONOURABLE MR. JUSTICE S.M.SUBRAMANIAM

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A.S.No.196 of 2011
And
M.P.No.1 of 2011
Anand
... Appellant/Defendant
vs.
Renganathan
... Respondent/Plaintiff
Appeal under Section 96 of the Code of Civil
Procedure, 1908, against the judgment and decree made in
O.S.No.8 of 2010 on the file of the District Court, Karaikkal
dated 12.11.2010.
For Appellant : Mr.S.Sounthar
For Respondent : Mr.S.Srinivasan
J U D G M E N T

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The first appeal on hand is directed against the judgment and decree dated 12.11.2010 passed by the learned District Judge, Karaikkal in O.S.No.8 of 2010.

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The defendant is the appellant and the respondent is the plaintiff in the present first appeal.

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The respondent/plaintiff filed O.S.No.8 of 2010 in Order VII, Rule 1 of the Civil Procedure Code, 1908 for the relief of recovery of money to a sum of Rs.4,76,000/- with 12% interest per annum on Rs.4,00,000/- from the date of plaint till the date of realisation and to pay the costs.

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The averments set out in the plaint are that the appellant/defendant is well acquainted with the respondent/plaintiff and the appellant/defendant had borrowed a sum of Rs.4,00,000/- from the respondent/plaintiff on 05.06.2008

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for his family expenditures and agreed to repay the said amount along with interest at the rate of 12% per annum on demand by the respondent/plaintiff.

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The appellant/defendant had also executed a promissory note in favour of the respondent/plaintiff on 05.06.2008. The respondent/plaintiff states that in spite of his repeated demands, the appellant/defendant did not come forward to make any payment either towards the principal or the interest as agreed upon. The non-payment of the loan by the appellant/defendant was willful and wanton. The respondent/plaintiff had issued an advocate notice on 02.07.2009 to the appellant/defendant, demanding repayment of the said loan amount along with interest. The said notice was acknowledged by the appellant/defendant and issued a reply stating that the contentions in the notice were false. However, the appellant/defendant had admitted the execution of the said promissory note in favour of the respondent/ plaintiff and he has disputed only the amount in the reply notice. Thus, the cause aroused for the respondent/plaintiff to institute the civil suit.

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The appellant/defendant in the written statement denied the allegations in the plaint by stating that the appellant/defendant had not borrowed a sum of Rs.4,00,000/on 05.06.2008 from the respondent/plaintiff and further denied the execution of promissory. It is contended that the said promissory note had no consideration and the respondent/plaintiff had created the alleged promissory note according to his wishes and with ill intention to make a wrongful gain with dishonest intention.

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It is admitted in the written statement that the appellant/ defendant had borrowed a sum of Rs.10,000/from the respondent/plaintiff and the respondent/plaintiff had obtained signatures from the appellant/defendant in an unfilled promissory note. It is stated that the practice of the respondent/plaintiff was that he used to charge monthly interest at 3% per month for the money lent and the appellant/defendant had paid the interest upto December 2008. The appellant/defendant further stated that himself and the respondent/plaintiff are acquainted with each other when both of them were working at Government School at Sethur. With the above contentions, the appellant/defendant denied the averments in the plaint and accordingly, requested to dismiss the suit.

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The Trial Court adjudicated the issues and the following issues are framed:“1. Whether the defendant has not executed the suit pro-note?

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the following issues are framed:-

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Whether there was no consideration passed on the suit pro-note?

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Whether the defendant is liable to pay the suit claim to the plaintiff?

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Whether the plaintiff is entitled for a decree for Rs.4,76,000/- with subsequent interest at 12% p.a. on Rs.4,00,000/- from the date of plaint till realization with costs?”

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The respondent/plaintiff examined himself as PW-1 and one another witness as PW-2 and marked Exs.A-1 to A- 4. The appellant/defendant examined himself as DW-1 and one another witness as DW-2 and marked Exs.B-1 to B-5.

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With reference to issue Nos.1 and 2, the findings of the Trial Court reveals that the appellant/defendant admitted the fact regarding the signature made by him in an unfilled promissory note. However, the appellant/defendant denied that the quantum of the amount borrowed.

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Reading of the written statement along with the findings of the Trial Court, the counter allegations made in the written statement by the appellant/defendant is not so clear to arrive a conclusion that there is a difference in the loan amount or otherwise. In the absence of any such clear denial with substantial evidence, this Court would not come to a conclusion that the loan amount borrowed is no way connected with the actual amount.

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However, DW-1 during his crossexamination, deposed that he signed in an unfilled promissory note belonging to the respondent/ plaintiff. It is further admitted by the appellant/defendant that he was paying the interest for the said amount upto December 2008 for the borrowal he made during August 2005. Even at that point of time, the appellant/defendant failed to depose that what was the interest amount paid by him whether the interest amount was paid for Rs.4,00,000/- or for Rs.10,000/-. In the absence of any such clear details or a clarity in the defence by the appellant/defendant, no inference can be drawn factually to arrive a conclusion that the appellant/defendant had borrowed only a sum of Rs.10,000/- and not Rs.4,00,000/-. Thus, the defence in this regard must be not only specific but should be made with clarity. Any ambiguity in respect of these aspects would result in favour of the respondent/plaintiff.

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The appellant/defendant in this case admitted the signature and even during cross-examination, admitted that he was paying the interest for the said amount

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upto December 2008. But the quantum of interest amount paid nor the details regarding the date on which he borrowed and signed the promissory note was furnished or established. Thus, the Trial Court on verification of the Ex-A-1 arrived a conclusion that the appellant/defendant had signed the promissory note and according to PW-2 also, the appellant/defendant had signed as a witness in Ex.A-1.

¶28

Though during the course of arguments, it was contended by the appellant/defendant that the respondent/plaintiff was a money lender and he had made use of the unfilled promissory note signed by the appellant/defendant for filing the present suit. After filing the same with the help of PW-2, there is no acceptable evidence to arrive a conclusion or to draw any such factual inference in favour of the appellant/defendant. In the absence of any such clinching evidence, this Court cannot arrive a conclusion that the amount borrowed by the appellant/defendant is only Rs.10,000/- and not Rs.4,00,000/-.

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In this regard, Section 20 of the Negotiable Instruments Act, 1881 is also relied upon. As per Section 20 of the Negotiable Instruments Act, the promissory note, the signature made by the appellant/defendant all goes in favour of the respondent/ plaintiff and under these circumstances, in the absence of any specific denial with clarity and in the absence of any evidence regarding the amount borrowed from the respondent/plaintiff, the Trial Court is right in arriving a conclusion that the issues 1 and 2 are decided in faovur of the respondent/plaintiff.

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The learned counsel appearing on behalf of the appellant/ defendant relied upon a judgment of this Court in the case of Kadarkarai Reddiar vs. Arumugam [AIR 1992 Madras 346], wherein the learned Single Judge of this Court considered the scope of Section 20, which reads as under:-

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“But, all that Section 20 confers on the delivery of the stamp paper is an implied prima facie statutory authority authorising him to complete the instrument or to write up full text of the instrument delivered to him and the Section does not say that by the very act of his filling up the blanks, the person to whom the paper is delivered acquires the right of a promisee under a promissory note. Such a person cannot be regarded as a holder in due course of that document. Therefore, he cannot render liable the maker or the person who signed that blank

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document as a person who is liable under the Act, within the meaning of the second part of Section 20.”

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The said observations made in the judgment, cited above, may not have any application as the quantum of amount borrowed was not established by the appellant/defendant before the Trial Court.

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The learned counsel for the appellant/defendant made a submission that the respondent/plaintiff is also equally failed to submit the Books of Accounts maintained by him. Under these circumstances, the weight of evidence alone is to be considered by the Courts. Even in the absence of production of Books of Accounts by the respondent/plaintiff, he could able to establish before the Trial Court that the appellant/defendant had signed the promissory note and paid the interest and during the crossexamination also, the appellant/ defendant had not established that he had paid the interest whether for Rs.4,00,000/- or for Rs.10,000/-. In view of such non-clarity in the evidence of the appellant/defendant, the Trial Court could able to arrive a conclusion that the respondent/plaintiff had established his case and accordingly, the suit was decreed in favour of the respondent/plaintiff. Thus, the judgment, cited above, by the learned counsel for the appellant/defendant has no avail as the facts as well as the evidences established before the Trial Court in that case are not in favour of the appellant/defendant in the present case.

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This being the factum, this Court is of the considered opinion that the Trial Court has rightly considered the documents as well as the evidences produced by the respondent/plaintiff and further rejected the case of the appellant/defendant as the appellant/ defendant could not able to establish the denial made in the written statement.

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Mere denial in the written statement is insufficient. All such denials must be established by way of documents or through evidences. In the absence of substantiating such denial, the Trial Court is right in decreeing the suit in favour of the respondent/plaintiff.

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Accordingly, the appellant/defendant in this appeal has not made out any acceptable legal ground for the purpose of interfering with the findings of the Trial Court and consequently, the judgment and decree dated 12.11.2010 passed by the District Court, Karaikkal in O.S.No.8 of 2010 is confirmed and the First Appal stands dismissed. However, there shall be no order as to costs. Consequently, connected miscellaneous petition is closed.

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Sd/-
Assistant Registrar(CS VIII)
//True Copy//
Sub Assistant Registrar
Svn
To
The District Judge,
District Court,
Karaikkal.
+1cc to Mr.S.Sounthar, Advocate Sr.100602
+1cc to Mr.S.Srinivasan, Advocate Sr.100541
A.S.No.196 of 2011
nrjk[co]
srg 27/08/2020

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https://hcservices.ecourts.gov.in/hcservices/

Anand, v. Renganathan

Case brief

What is this about?

What did the court decide?

Anand, v. Renganathan

Case brief

What is this about?

What did the court decide?

What the court decided

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