Telangana High Court
Vadlakonda Srinivas vs Marumamula Sandeepa Rushi on 4 April, 2024
THE HON'BLE SRI JUSTICE SAMBASIVARAO NAIDU
SECOND APPEAL No.922 OF 2016
JUDGMENT :
Being aggrieved by the Judgment dated 13.04.2016 in A.S.No.34 of 2014 on the file of VI Additional District Judge, Siddipet, by which his first appeal against the Judgment and Decree of the trial Court in O.S.No.56 of 2012 dated 22.08.2014 whereunder a decree for recovery of money was granted in favour of the respondent/plaintiff, was dismissed, this Second Appeal has been filed by the defendant in the original suit under Section 100 Code of Civil Procedure (for short "CPC"), assailing the Judgment of the 1st appellate Court on the following grounds:
The trial Court and 1st appellate Court ought to have seen that Ex.A1 the alleged promissory note which is without any date, month and year, is not a valid document in the eye of law, as such suit on the basis of such a promissory note is not maintainable.2
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2. The appellant has claimed that respondent/plaintiff has to be non-suited as there is no cause of action and as no suit can be filed on the promissory note without any date of the instrument and it would cause serious prejudice to the appellant. The Courts below committed a wrong in passing a decree on the basis of Ex.A1 which according to the appellant herein is not a valid document in the eye of law. He has also claimed that the trial Court and 1st appellate Court ought to have seen that Ex.A2 cannot cure the defect in the promissory note. The appellant claims that according to Section 20 of Negotiable Instruments Act, 1881 (for short "N.I.Act.") it enables the holders of document to fill the date only and as such the Courts below committed an error in observing the instrument is valid under Section 20 of N.I.Act. The appellant has claimed that the Courts below misconstrued the pleadings and evidence, thereby come to an erroneous conclusion. The Courts below ought to have seen that the evidence did not prove the borrowing of the amount by the appellant or execution of promissory note by 3 SA.No.922 of 2016 him. Therefore, sought for setting aside the impugned judgment.
3. As could be seen from the Judgment of the trial Court in O.S.No.56 of 2012 and the Judgment of the 1st appellate Court in A.S.No.34 of 2014, it seems the respondent/plaintiff has filed original suit against the present appellant for recovery of money on the basis of promissory note said to have been executed by the present appellant. According to the plaint filed by the respondent before the trial Court, he has pleaded that the appellant borrowed an amount of Rs.3,00,000/- from him in the first week of January, 2011, executed the promissory note and receipt vide Ex.A1. The appellant herein filled up the contents of the promissory note, but kept the columns of date, month and year in the promissory note as blank by giving an option to the respondent/plaintiff to fill the same whenever necessary. He has also pleaded that the appellant herein agreed to repay the amount with interest @18% per annum. But, there was failure in payment of the money, as 4 SA.No.922 of 2016 such the respondent sought for recovery of amount due under the promissory note.
4. The appellant herein resisted the claim, filed a written statement with a particular plea that he used to borrow petty loans of meager amounts from the respondent and used to pay the same. The respondent used to obtain promissory notes from him. Therefore, according to the appellant he has received some petty amounts from the respondent, but paid the outstanding amount through cheque as final settlement. The respondent promised the appellant that he would return the promissory notes, but filed the suit for recovery of money. As such, according to the appellant he is not liable to pay any amount and he prayed for dismissal of the suit.
5. The following issues were framed by the trial Court.
1. Whether the plaintiff is entitled to decree for recovery of Rs.3,67,500/- with costs and interest as prayed for?
2. To what relief?
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6. During the trial the respondent himself was examined as PW1 and he has examined one of the attestors of the suit promissory note and letter executed by the present appellant as PW2. Exs.A1 to A5 were marked. The appellant herein was examined as DW1 and he has marked Exs.B1 and B2. The trial Court believed the claim of respondent and passed a decree for recovery of the suit amount. The 1st appeal filed by the appellant herein was dismissed on contest and on merits.
7. This Second Appeal has been admitted on the following substantial questions of law:
a. Whether the courts below are correct in decreeing the suit without date, month and year on the Promissory Note which seriously prejudice the cause of action with reference to law of limitation?
b. Whether the Promissory Note without date, month, year is executable when in Ex.A2 also does not mention the date of the alleged transaction. The respondent / plaintiff has not availed the opportunity to fill the date under Section 20 of Negotiable Instruments Act, 1881.
c. The courts below are correct in decreeing the suit, the respondent / plaintiff is not having money lending license when the respondent / plaintiff admitted that he has lent money to other person also.6 SA.No.922 of 2016
d. Whether Judgment and Decree of court below is correct placing reliance on Section 20 of Negotiable Instrument Act when the respondent / plaintiff has not filled the contents of date, month and year in the blank Promissory Note.
8. Heard both parties.
9. According to the pleadings and evidence produced by the respondent, it was his specific contention that the present appellant having borrowed Rs.3,00,000/-, executed a promissory note in his favour, but he was given liberty to fill up the date on the promissory note. To prove his claim, apart from examining himself as PW1, he has examined PW2 to prove the contents of Exs.A1 and A2-letter.
10. The appellant, who has admitted the practice of borrowing money from the respondent, took a specific stand that he has discharged the entire outstanding amount, but there was failure by the respondent in returning the promissory notes. He has also claimed that the suit promissory note in view of the alleged defect is an invalid document and respondent cannot sue him for recovery of money.
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11. The trial Court as well as 1st appellate Court accepted the oral and documentary evidence of PWs 1 and
2. The appellant while filing the written statement before the trial Court, in spite of his claim that he used to borrow petty amounts from the respondent, has also claimed that with regard to suit amount, the respondent has no capacity to pay such a huge amount as hand loan. There is no explanation from the appellant as to why he did not insist the respondent for return of all the promissory notes when he was able to discharge the entire amount that too by way of cheque.
12. According to the notice issued by the appellant herein under Ex.A3 he has claimed that respondent forced him to execute the documents for Rs.3,00,000/- payable with interest @ 18% per annum. Therefore, by the said averments in the reply notice, the issuance of which is not in dispute, the respondent is able to prove execution of the promissory note. Whereas, the appellant was not able to prove the contention that he has executed the said promissory note at the pressure of the respondent. 8 SA.No.922 of 2016
13. It is in the evidence of DW1 that he has borrowed money from the respondent more than 10 times during 2002-2005. However, he has claimed that the highest amount which he borrowed from the respondent was Rs.30,000/-. It is not known why the appellant herein executed the promissory note for Rs.3,00,000/-, if he borrowed money to the tune of Rs.30,000/-. It is not the case of appellant that he did not fill up the suit promissory note. Therefore, in view of the presumption under the N.I.Act, when once the execution of the promissory note is proved, it shall be presumed that the promissory note was executed for consideration.
14. It is true the respondent has contended that the suit promissory was filled up by the appellant herein, but he did not fill up the date in the promissory note and the respondent was given liberty to fill it up. According to Section 20 of N.I.Act., where one persons signs and delivers to another a paper stamped in accordance with the law relating to Negotiable Instruments then in force in India, thereby gives prima facie authority to the holder thereof to 9 SA.No.922 of 2016 make or complete as the case may be upon it a Negotiable Instrument for any amount specified therein and not exceeding the amount covered by the stamp. The person so signing shall be liable upon such instrument in the capacity in which he signed the same.
15. In a recent Judgment in Appeal Suit vide A.S.No.301 of 2009, the High Court at Amaravathi ruled that inchoate or incomplete documents that are stamped in accordance with law relating to Negotiable Instrument are legal instrument under Section 20 of N.I.Act.,
16. According to Section 20 of N.I.Act., it makes inchoate and incomplete stamped instrument as legal documents. The evidence produced by the PWs 1 and 2 makes it clear that the appellant herein did not dispute the signature and execution of the document. Therefore, in view of the Section 20 of N.I.Act., the respondent-plaintiff is entitled to claim the suit amount on the basis of the said document. Therefore, the trial Court as well as the 1st appellate Court rightly held the liability of the appellant against the respondents.
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17. Therefore, there are no grounds to interfere with the concurrent finding of the trial Court as well as the 1st appellate Court. As such, the appeal is liable to be dismissed.
18. In the result, the appeal is dismissed. No costs. As a sequel, pending Miscellaneous Applications, if any, shall stand closed.
___________________________________ JUSTICE SAMBASIVARAO NAIDU Date:04.04.2024 PSSK