Kuldeep Singh Vs Devi Dayal and Another

Fe e ling aggrieved by the concurre n t findings of the Courts below, the present Regula r Second Appeal has been pref e rred by the defendant. The lear n ed trial Court, vid e judgment and decree dated 0 7.04.2017, decreed the suit of the plaintiffs for r ecovery, which judgment wa s affirmed by the learned lo w er appellate Court vide judgment and decree dated 22.07.2025.

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Brief Facts

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Br i efly stated, the case of the pla i ntiffs is that they are commis s ion agents dealing i n sale and purchase of agricult u ral produce at New Grain Mar k et, Kurukshetra, a n d the defendant was their reg u lar customer who used to sell his agricultural pro d uce through them and also us e d to take advances from them for agricultural needs. It is the pleading of the pla i ntiffs that all transactions bet w een the parties wer e maintained in their regular a c count books in rokars, bahi khata, and rojnamcha a nd on 30.04.2011 the defendan t borrowed a sum of ₹17,000/- f r om the plaintiffs a n d a sum of ₹15,358/- was debi t ed in the account of the defend a nt, TRIPTI SAINI 2025.12.10 16:32 I attest to the accuracy and integrity of this document

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and the total a mount was duly entered in t he rojnamcha, acknowledging an outstanding bal a nce of ₹2,58,000/- against the d efendant. It is further pleaded t hat subsequent entries dated 27.07.2011, 28.11.20 1 1 and 23.05.2012 were also m a de, and after adj u stment of various receipts a nd commissions, an amount of ₹4,00,000/- re m ained outstanding against the d e fendant, despite repeated dema n ds, compelling the plaintiffs to file the present sui t for recovery along with pend e nte lite and future i n terest @ 12% per annum till re a lization.

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In the written statement, the def e ndant took preliminary objections regarding main t ainability, locus standi, cause of action, limitation, estoppel and mis-joinder of p arties. The defendant denied h aving borrowed any amount f r om the plaintiffs a n d denied acknowledging any b a lance once or ever. It was pleaded that the signat u res/thumb impressions appea r ing on the account entries w ere fraudulently ob t ained under the pretext of pro d ucing the books before the Inc o me Tax Departmen t , and that the plaintiffs had ma n ipulated and forged the said ent r ies to create a false liability. The defendant specifi c ally disputed that he ever owed any amount to the p laintiffs and asserted that no a m ount was ever borrowed or set t led on any of the d a tes mentioned by the plaintiffs.

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Th e following issues were framed by the trial Court vide order d a ted 06.01.2015:

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Whether the plaintiffs are e ntitled to decree for recover y of ₹4 , 00,000/- along with pendente li t e and future interest? OPP 2. Whether the suit of the pl a intiffs is not maintainable in the pr e sent form? OPD

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Whether the plaintiff has no locus standi to file the present s u it? O P D

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TRIPTI SAINI 2025.12.10 16:32 I attest to the accuracy and integrity of this document

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RSA-3242-2025 (O&M) - 3-

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Whether the plaintiff firm is a money-lending firm having no lic e nce to do the business of mone y -lending? OPD

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Relief.

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In order to prove their case, the p laintiffs examined plaintiff N o . 1 Devi Dayal as PW-1, who tendered his dul y sworn affidavit Ex.PW1/A and reiterated the a v erments made in the plaint. The plaintiffs also examined Bha v esh Kumar, officia l of the Income Tax Depart m ent, as PW-2, who brought the summoned rec o rd pertaining to the income tax returns of the plaintiff firm for the financial years 2 007-2008 to 2012-2013 and c o mpared the same with photoco p ies Ex.P18 to Ex.P 2 3 and stated them to be correc t as per office record. PW-3 Ga n ga Ram Yadav, R DO, UBOI stepped into th e witness box and produced the summoned record pertaining to account details o f plaintiff firm and stated the s a me to be correct a s per his office record. The pl a intiffs also adduced documen t ary evidence Ex.P1 to Ex.P30 and Mark-A and Ma r k-B. 6. O n the other hand, to rebut the c a se of the plaintiffs, the defen d ant examined hims e lf as DW-1 and tendered his d u ly sworn affidavit Ex.DW1/A. He was cross-exa m ined at length. The defendant a l so produced documentary evid e nce Ex.D1 to Ex.D 7 .

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Findings of the trial Court

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Th e learned Trial Court, after app r eciating the oral and documen t ary evidence led b y the parties, recorded the find i ngs that the plaintiffs successf u lly proved that pl a intiff No.1 is the sole propr i etor of M/s Shiv Shakti Tra d ing Company and t h at the business is a proprietors h ip concern engaged in commis s ion agency, and not a partnership firm as alleged b y the defendant. The Court held t hat the plaintiffs p l aced on record sufficient doc u mentary evidence in the for m of TRIPTI SAINI 2025.12.10 16:32 I attest to the accuracy and integrity of this document

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income tax retu r ns Ex.P18 to Ex.P23, bank account opening form Ex.P25, and the order passed by the Excise and Taxation Office r Ex.P30, all of which corrobor a ted the proprietors h ip status of the firm.

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Th e Trial Court further found t hat the defendant was a reg u lar customer of the plaintiffs and used to supply ag r icultural produce at the shop o f the plaintiffs. It w a s proved through the accoun t books Ex.P1 to Ex.P17 that the defendant used to borrow advances from the p l aintiffs from time to time, and t hat the entries in th e rokar, rojnamcha, khatas and b ahi accounts were duly maintai n ed in the ordinar y and regular course of bu s iness. The Court held that the signatures/thu m b impressions of the defendant on the account entries amounte d to acknowledgme n t of liability and that the plaint i ffs had properly proved the ent r ies through PW-1, PW-2 and PW-3. The Court r e jected the plea of manipulatio n or fabrication of a c count entries, observing that the entries in the account books w ere further corroborated by the income tax retu r n of the plaintiff firm and o t her documentary e v idence.

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Th e learned Trial Court also he l d that the plea of the defen d ant regarding non- m aintainability of the suit on t h e ground that the plaintiffs w ere engaged in mo n ey lending without licence w a s without merit. It was concluded that the plaintif f s are engaged in commission a g ency business and advancing loan to farmers/cust o mers in the regular course of such business does not amoun t to carrying on the business of money lending so as to attract the provisions of the Punjab Registr a tion of Money Lenders Act. The Court also held that m ere allegations of f r aud and fabrication raised by t he defendant were unsupporte d by any evidence a n d were insufficient to discharge the burden of proof.

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TRIPTI SAINI 2025.12.10 16:32 I attest to the accuracy and integrity of this document

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Upon overall consideration of the e vidence, the Trial Court concluded that the plainti f fs had proved recovery of Rs. 4,00,000/- including principal and interest from th e defendant, and therefore, decr e ed the suit with costs.

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Findings of the Lower Appellate Court

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Th e learned lower appellate court, after re-appreciating the entire o ral and documenta r y evidence, affirmed the find i ngs recorded by the learned t rial Court. It was h e ld that the plea of the defenda n t regarding the plaintiff firm b e ing an unregistered partnership firm was without any substance, as the income tax returns Ex.P18 to Ex.P23 clearly reflected th e plaintiff firm as a proprietor s hip concern and th e defendant failed to rebut this e v idence. The appellate court fur t her observed that the order of the Excise an d Taxation Officer Ex.P30 a lso corroborated th e status of plaintiff No.2 as a pr o prietorship concern carrying on the business of co m mission agency. It was furthe r noted that the defendant him s elf, during cross-e x amination, admitted that he had been selling his agricult u ral produce to the plaintiffs for many years and c ould not produce any materia l to show that the p l aintiff firm was a partnership fi rm. The lower appellate court a lso affirmed the fi n ding that the defendant had acknowledged his liability in the account books o f the plaintiffs, including his s ignatures on Ex.P7 and the le d ger entry Ex.P15, a n d that the bahi entries Ex.P1 t o Ex.P17 had been duly prove d by the plaintiffs a n d corroborated by the income tax returns Ex.P18 to Ex.P23 and balance sheets Ex.P27 to Ex.P29. The appell a te court held that the defenda n t’s allegations of m anipulation and fraud in the a c count books were unsupporte d by any evidence a n d mere self-serving statements c ould not rebut the cogent evidence led by the plain t iffs. It was further held that sin c e the defendant had acknowledged the liability on 3 0.04.2011, the suit filed on 22. 0 4.2014 was well within the pe r iod TRIPTI SAINI 2025.12.10 16:32 I attest to the accuracy and integrity of this document

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of limitation. T h e appellate court also upheld t he rate of interest awarded by the trial Court at 9 % per annum, observing that the defendant himself admitted that the prevailing rate of interest in the market w a s the same. Concluding that the judgment of th e learned trial Court was well reasoned, did not suffer from a ny infirmity or ill e gality, and was based on pr o per appreciation of evidence, the learned lower a p pellate court dismissed the app e al with costs. 12. Aggrieved by the concurrent fi n dings of the Courts below, the appellant has preferred the present regular seco n d appeal.

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Submissions of learned counsel for the appellant

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Le a rned counsel for the appellant a rgued that the impugned judgm e nts and decrees passed by the Courts below are lia b le to be set aside. It was contended that both the C o urts below have failed to appr e ciate the facts of the case and the documentary e v idence produced by the appell a nt. It was argued that the plai n tiff firm is an unregistered partnership firm an d , therefore, the suit filed by the plaintiffs was b arred under Section 69 of t h e Partnership Act. Accordin g to counsel, the pl a intiffs have wrongly shown th e mselves to be proprietors, whe r eas the material on record allegedly proves that t h e firm is a partnership concer n . It was further sub m itted that the plaintiffs did no t produce complete bahi khatas, nor did they lead a ny cogent evidence to prove t h e entries recorded therein. It w as argued that the a lleged acknowledgments relied upon by the plaintiffs were bey o nd limitation and, t herefore, of no legal consequen c e. 14. Le a rned counsel further submitted that the balance sheets produce d by the plaintiffs w ere never filed before the Inc o me Tax Department and there f ore could not have been relied upon by the Courts below. It was argued that mos t of the entries in th e account books pertain only to interest and, therefore, the sam e do TRIPTI SAINI 2025.12.10 16:32 I attest to the accuracy and integrity of this document

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not prove that a ny principal amount was recoverable from the appellant. It w as further submitt e d that Form-J (Ex.D4) receipts i ssued to the appellant at the tim e of sale of crop we r e not properly accounted for b y the plaintiffs and hence there w as every reason t o disbelieve the bahi khatas p r oduced in the case file. Lear n ed counsel also su b mitted that the balance sheets w ere not proved on record and t hat even otherwise they were never submitted bef o re the Income Tax authorities, and therefore, the C ourts below erred in relying upon the same. It was contended t hat the law is well settled that the respondents h a ve to stand on their own legs and cannot take ben e fit of any weakness in the defe n ce of the appellant.

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Findings of this Court

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I h ave considered the arguments raised by learned counsel for the appellant and perused the impugned judgment s and material available on rec o rd. However, I do n ot find myself in agreement w i th the contentions raised. Both the Courts below have returned concurrent findin g s of fact after appreciating ora l as well as docu m entary evidence in detail. T he Courts below have recorded categorical fin d ings that the plaintiff firm is a proprietorship concern and no t an unregistered p a rtnership firm. These findings are based on income tax retu r ns, bank document s , Excise and Taxation record ( E x.P30), and the evidence of PW 1 to PW3. No cont r ary evidence has been produc e d by the appellant to rebut t h ese findings.

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Fu r ther, the Courts below have ex t ensively examined the bahi ent r ies, rojnamcha and khata records (Ex.P1 to Ex. P 17), and found them to be d uly maintained in t h e ordinary course of business. The signatures of the defendan t on Ex.P7 and corr e sponding entries in Ex.P15 ha v e been admitted by the defen d ant himself in his w ritten statement as well as duri n g his cross-examination. Once the TRIPTI SAINI 2025.12.10 16:32 I attest to the accuracy and integrity of this document

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acknowledgme n t of liability dated 30.04.2011 stands admitted, the suit filed on 22.04.2014 is c learly within limitation. The defence that the signatures w ere obtained fraud u lently has been rightly rejected by the Courts below, as mere o ral allegations can n ot displace positive documenta ry evidence.

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Th e lower Appellate Court has al s o rightly held that merely bec a use the plaintiffs a d vanced money to a customer d o es not make them money lenders, as the transacti o ns are incidental to their work a s commission agents. The findings recorded on Iss u es No.1 to 5 are well reasoned , supported by evidence, and do not suffer from any illegality or perversity.

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Conclusion

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In view of the above and applyi n g the settled legal principles, t his Court finds tha t the impugned judgments are b a sed on concurrent findings of f act, which cannot b e interfered with in second ap p eal unless shown to be perverse. Accordingly, the present RSA is dismissed in l i mine, without issuing notice to the respondents.

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Pe n ding applications, if any, also s t and disposed off.

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December 09, 2025 (MANDEEP PANNU) tripti JUDGE W h ether speaking/non-speaking : Speak i ng W h ether reportable : Yes/N o

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Kuldeep Singh v. Devi Dayal and Another

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Kuldeep Singh v. Devi Dayal and Another

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