THE HON'BLE SRI JUSTICE M.LAXMAN
APPEAL SUIT No. 942 OF 2016
JUDGMENT:
1. The present appeal has been filed challenging the judgment and decree dated 11.04.2016 in O.S.No.61 of 2012 on the file of I Additional District Judge, Nalgonda, wherein and whereby, the suit filed by the respondent against the appellants for recovery of Rs.17,19,000/- along with pendente lite interest and costs, was allowed.
2. The appellants herein are defendants and the respondent herein is plaintiff in the suit. For the sake of convenience, the parties hereinafter are referred to as they are arrayed in the suit.
3. The short case of the plaintiff is that he and defendant No.1 are having acquaintance with each other. The plaintiff purchased land to an extent of Ac.1-00 guntas from defendant No.1. Whileso, on 31.10.2011, defendant No.1 approached the plaintiff seeking hand loan to meet his business expenses and other family needs. In this connection, the plaintiff lent an amount of Rs.16,00,000/- and defendant No.1 executed a promissory note on the same day. Defendant no.2, who is the 2 son of defendant No.1, stood as surety for payment of the amount lent in favour of defendant No.1 and the same was reduced into writing in the presence of the witness and scribe. On account of non-payment of money, there was exchange of notices between the parties; even then, when the said amount was not re-paid by the defendant No.1, the present suit has been filed by the plaintiff.
4. The case of the defendants is that they denied the loan transaction for an amount of Rs.16,00,000/- and submitted that there were previous transactions between the parties for smaller amounts not exceeding Rs.50,000/-. Accordingly, the plaintiff must have used the previous promissory note, which defendant No.1 executed in blank, to lay the present claim or the plaintiff might have forged the promissory note, taking advantage of availability of signature of defendant No.1, in order to pressurize defendant No.1 to sell his half acre of land, which is abutting to the land purchased by the plaintiff from defendant No.1 earlier. According to the defendants, there is alteration of amount in the security part of Ex.A-1/promissory note. Hence, they prayed to dismiss the suit.
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5. On the basis of above pleadings, the following issues were framed by the trial Court:
"1. Whether the plaintiff is entitled for recovery of the amount, as prayed for?
2. Whether there are any material alterations in the suit pro-note, so, the suit is not maintainable?
3. Whether the suit pro-note was brought into existence in the circumstances as prayed by the defendants?
4. Whether the suit pro-note is forged and fabricated?
5. To what relief?"
6. The plaintiff, in support of his case, examined P.Ws.1 to 3 and relied upon Exs.A-1 to A-8. The defendants, to support their case, examined D.W.1 and got marked Exs.B-1 and B-2.
7. The trial Court after appreciating the evidence on record has not accepted the defence set up by defendants and decreed the suit in favour of the plaintiff. Hence, the present appeal at the instance of defendants.
8. Heard both sides.
9. In the light of above submissions, the points emerged for consideration in this appeal are as follows:
"1. Whether the Ex.A-1 promissory note is supported by consideration?4
2. Whether the plaintiff is entitled to recover the amount as prayed for?
3. To what relief?"
Point Nos.1 and 2:
10. As seen from the evidence adduced by both the parties there is clear admission from defendant No.1 that signature on Ex.A-1 belongs to him. This means his plea of forgery does not sustain anymore. Once the execution of document is admitted, the presumption under Section 118 of Negotiable Instruments Act, 1881 is available in favour of the plaintiff. Then, the burden shifts to defendants to rebut such presumption and once such defence is made out probablising the case, the burden again shifts to the plaintiff to establish the transaction.
11. In the present case, the defence set-up by the defendants is that there is no transaction relating to amount of Rs.16,00,000/-. Their second ground is that the plaintiff filed the present suit, in order to exert pressure on defendant No.1 to sell his balance half acre land, which is abutting to the land which he already sold to plaintiff. The third plea set-up by defendants was that the plaintiff has no capacity to lend an amount of Rs.16,00,000/- and further, defendant No.1 had no 5 necessity to borrow such huge amount of money. The fourth defence set-up by defendants is that a promissory note which he had executed previously in blank to avail loan amount was used by the plaintiff for the present claim.
12. The plaintiff in support of his contentions got examined himself as P.W.1 and also examined P.W.2, who is the attestor to Ex.A-1 and P.W.3, who is scribe of Ex.A-1. The initial pleadings of the plaintiff and the contents of the Ex.A-1 does not reflect the name of the scribe of promissory note. It is not disputed that except the signature part, the rest of the part of Ex.A-1 was not accepted by executant of document.
13. It is the case of plaintiff that the writing on Ex.A-1 belongs to P.W.3. The name of P.W.3 first appeared in the evidence of P.W.2. There is no reference of his name in the promissory note. The evidence of P.W.1 also shows that he is having close acquaintance with P.W.2, as he stays near to his house; in fact, they are related to each other. The evidence of P.W.1 shows that during the cross-examination of P.W.1, P.W.2 was present in the Court hall. Hence, the defence of defendants was known to P.W.2.
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14. P.W.1 admitted that there are previous loan transactions between himself and defendant No.1. He also admitted that in the said previous transactions, he never lent more than Rs.50,000/- to defendant No.1. He further admitted that he purchased one acre land from defendant No.1 and one acre from the brother of defendant No.1. In his cross-examination, P.W.1 also admitted that he does not know the extent of land which was held by defendant No.1. The evidence of defendant No.1 shows that he was running TATA Sumo vehicle on rent. No evidence is placed on record to show that the defendant No.1 was doing real estate business. The P.W.2 tried to establish in his evidence that defendant No.1 was doing real estate business in Miryalguda, but he failed to submit any proof in this regard. The evidence of P.W.2 also shows that defendant No.1 never borrowed more than Rs.50,000/- from the plaintiff.
15. The evidence of P.W.1 does not show the extent of land owned by defendant No.1. P.W.1 tried to set up that he secured the money by sale of plots situated in Miryalguda and lent the same to defendant No.1. He submitted that the said plots were sold to one Thirupati for sale consideration of Rs.14,50,000/-. However, he has not produced any proof as to the sale of plots. 7 He only referred to document bearing No.4327/2011 during the cross-examination of D.W.1, but said document is not reflected in the encumbrance certificate i.e., Ex.B-1 produced by the defendants. This demolishes the case of plaintiff that money he lent was secured by sale of plots. When such evidence is on record, the existence of previous loan transactions, existence of P.W.1's land abutting to defendant No.1's remaining land and execution of blank promissory notes previously demonstrates that the defence set-up by the defendant No.1 to rebut the presumption is probable. Once, this defence is probable, then the burden shifts to plaintiff to establish that there is a loan transaction of Rs.16,00,000/- and consideration was paid to defendant No.1.
16. Plaintiff failed to establish that he sold plots and secured an amount of Rs.14,50,000/-. The evidence of P.W.2 cannot be believed as he is interested witness, since he has close acquaintance with the plaintiff. The name of P.W.3 first appeared during the evidence of P.W.2 and his name is not reflected either in pleadings or on Ex.A-1. Further, evidence of P.W.3 cannot be believed, as he is also close acquaintance of plaintiff. Therefore, such evidence requires further 8 corroboration and such corroboration is lacking in the present case.
17. In the said circumstances, the plaintiff has failed to set-up his case of lending an amount of Rs.16,00,000/- to defendant No.1. Hence, the appeal is liable to be allowed by setting aside judgment and decree passed by the trial Court. Point No.3:
18. In the result, the appeal is allowed setting aside judgment and decree dated 11.04.2016 in O.S.No.61 of 2012 on the file of the I Additional District Judge, Nalgonda. Consequently, the O.S.No.61 of 2012 is dismissed. There shall be no order as to costs. Miscellaneous petitions, if any, pending, shall stand closed.
_______________ M.LAXMAN, J Date: 24.11.2022 GVR