Mandadapu Venkateswarlu vs Nakirikanti Krishna Rao
2022 Latest Caselaw 2170 AP

          HON'BLE SRI JUSTICE SUBBA REDDY SATTI

                  APPEAL SUIT No.2159 of 2001

JUDGMENT:-

        Assailing the judgment and decree, dated 29.06.2001

passed in O.S.No.56 of 1999 on the file of learned Senior Civil

Judge, Nandigama, defendant No.2 filed the present appeal.


2.      For the sake of convenience and brevity, the parties shall

be referred to as they are arrayed in O.S.No.56 of 1999.


3.      Originally suit O.S.No.212 of 1995 was filed on the file of

First Additional Sub-ordinate Judge, Vijayawada, against the

defendants for recovery of an amount of Rs.1,72,000/- principal

being Rs.1,00,000/-. Thereafter, the suit was transferred to

Senior Civil Judge, Nandigama and renumbered as O.S.No.56 of

1999.


4.      The averments of the plaint, in brief, are that defendant

No.1 firm represented by defendant No.2 borrowed an amount of

Rs.1,00,000/- from the plaintiff on 25.02.1992 at Nandigama

promising to repay the amount with interest at 24% per annum.

Defendant No.2 having received consideration of Rs.1,00,000/-

executed hand letter on the letterhead of defendant No.1 on its

behalf and affixed stamp of the firm. The said amount was

borrowed in the presence of Boggavarapu Narasimha Rao and

Tirumalasetti Nagasatyanarayana and they signed as attestors.

Defendant No.2 represented that he would repay the amount

within a short period. Since the amount was not repaid, the

plaintiff demanded for repayment of the amount, but none of the
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defendants had paid the amount. Apart from the suit debt,

defendant No.1 represented by another partner, defendant No.3

borrowed     several   amounts   from   the    plaintiff   under   the

letterhead of defendant No.1. Hence, suit was filed for recovery

of amount.


5.    Defendant Nos.1 and 3 remained ex parte and the claim

against defendant Nos.4 and 5 was given up by the plaintiff.


6.    Defendant No.2 filed written statement and contended

inter alia that hand letter, dated 25.02.1992 is not valid and not

enforceable in the Court of law as it is inadequately stamped;

that defendant No.2 is no way concerned with defendant No.1

firm and the suit is bad for non-joinder of parties; that

defendant No.2 got acquaintance with the plaintiff; that on

25.02.1992, the plaintiff approached defendant No.2 and

requested him to execute nominal promissory note for his

personal purpose for which defendant No.2 did not accept; that

the plaintiff later brought one letterhead of M/s. Sri Annapurna

Fertilizers and one rubber stamp of the firm and requested

defendant No.2 to execute promissory note on the paper without

stamp so that the same will not bind him in future; that since

the   document     neither   binds   him      nor   enforceable,    to

accommodate the plaintiff he executed the document; that no

consideration was paid; that no attestors were present at the

time of execution of the said document; that on receiving

summons, defendant No.2 came to know that the plaintiff

deceived defendant No.2 and made use of the document for
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unlawful gain; that no demand was made by the plaintiff at any

point of time and prayed the Court to dismiss the suit.


7.     Defendant No.5 filed written statement and the same was

adopted by defendant No.4. In the written statement of

defendant No.5, it was inter alia contended that defendant No.2

is no way concerned with defendant No.1 firm and he is not

partner of the said firm; that defendant No.3 is Managing

Partner and defendant Nos. 4 to 6 are partners of defendant

No.1 firm; that the receipt issued by defendant No.2 on behalf of

defendant No.1 does not bind defendant No.1 firm and its

partners; that defendant No.3, who is Managing Partner of

defendant No.1 is close friend of the plaintiff; that disputes

arose between the Managing Partner and other partners of the

firm due to which defendant No.3 created the alleged hand letter

in collusion with defendant No.2; that the plaintiff did not issue

any notice prior to the filing of the suit and prayed the Court to

dismiss the suit.


8.     Basing on the above pleadings, the lower Court framed the

issues and additional issues:


     1. Whether the plaintiff is entitled for the suit amount as

        prayed for?


     2. Whether the 2nd defendant executed the suit pronote

        without consideration and out of friendship with the

        plaintiff at the request of the latter?


     3. To what relief?
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Additional issues, dated 04.08.2000:


     1. Whether the fourth and fifth defendants are liable to

        discharge the suit amount as prayed for?


     2. To what relief?


Additional issues, dated 01.12.2000:


     1. Whether the second defendant is a party to the 1st

        defendant firm?


     2. Whether the second defendant borrowed the suit amount

        on behalf of 1st defendant firm?


     3. Whether the plaintiff is entitled to ask any relief against

        the 1st defendant firm?


     4. To what relief?


9.      During the course of trial, plaintiff examined himself as

PW1 besides examining PW2, one of the attestors and got

marked Ex.A1. On behalf of the defendants, defendant No.2

examined himself as DW1 and also got examined DW2.

However, no documents were marked.


10.     The   lower   Court,      on       consideration   of   oral   and

documentary evidence decreed the suit with costs against

defendant No.2 only. The suit against defendant Nos.1, 3 and 6

is dismissed. Aggrieved by the said judgment and decree, the

above appeal is filed.
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11.     Heard Sri P. Prabhakar Rao, learned counsel for the

appellant/defendant No.2 and Sri Ambadipudi Satyanaryana,

learned counsel for respondent No.1/plaintiff.

12. Learned counsel for the appellant/D2 would contend that

Ex.A1 letter is not valid and un-enforceable since it requires

stamp duty and no consideration was passed under Ex.A1. He

also would contend that the pleadings of the plaintiff are

contrary to the evidence on record and hence the lower Court

ought not to have decreed the suit against defendant No.2

contrary to the pleadings. He would further contend that the

entire case of the plaintiff is that defendant No.2 being the

Managing Partner of the defendant No.1 firm borrowed the

amount. In fact he asserted the same in his pleadings and

evidence. Hence passing decree against defendant No.2 alone is

not correct, since it was proved that defendant No.2 is not

partner of the said firm.

13. Learned counsel for appellant/D2 relied upon Allam

Gangadhara Rao v. Gollapalli Gangarao1 and Bachhaj Nahar

v. Nilima Mandal and another2.

14. Learned counsel for the 1st respondent/plaintiff would

contend that the trial Court rightly decreed the suit against

defendant No.2 being the borrower of the amount and he

supported the judgment of the trial Court. He relied upon Devji

@ Devji Shivji vs. Maganlal R. Athrana & Others3.

AIR 1968 AP 291

2008 (17) SCC 491

AIR 1965 SC 139

15. In the light of the contentions raised on either side, the

following points arise for consideration:

1. Whether Ex.A1, letter is legally enforceable and basing on

the said letter, the suit is maintainable for recovery of

amount?

2. Whether the appellant/defendant No.2 is partner of

defendant No.1 firm?

3. Whether appellant/defendant No.2 borrowed the amount

on behalf of defendant No.1 firm?

4. Whether the judgment and decree under appeal are to be

interfered with?

5. To what relief?

Since point Nos.1 to 4 are interrelated they are dealt with

together.

16. Ex.A1 letter was scribed by defendant No.2 in his own

handwriting on 25.02.1992. A perusal of Ex.A1 reveals that

defendant No.2 scribed the said letter and the recitals therein

are to the said effect that, he borrowed an amount of

Rs.1,00,000/- on 25.02.1992 and agreed to pay interest at 24%

per annum. The same was attested by two witnesses. Defendant

No.2 scribed the same on the letterhead of M/s. Sri Annapurna

Fertilizers. During the trial, Ex.A1/letter was impounded by

collecting stamp duty and penalty. Hence, the contention of

defendant No.2 that Ex.A1 could not have been marked without

proper stamp duty is not correct, since appropriate stamp duty

was already collected with penalty by impounding the same

during the course of trial.

17. The trial Court treated Ex.A1 as letter and accordingly the

same was impounded as stated supra. The recitals of Ex.A1 also

make it clear that it is only a letter but not promissory note.

Apart from examining himself as PW1, the plaintiff also got

examined one of the attestors as PW2 to prove execution of the

document. A perusal of the Ex.A1 manifests that it is only a

letter executed by 2nd defendant at the time of borrowing the

amount from the plaintiff. Since it was impounded by paying

stamp duty and penalty it is enforceable and hence the

contention of the learned counsel qua the admissibility of Ex A-

1 is negatived.

18. Whether defendant No.2 is partner of defendant No.1 firm

and whether he borrowed the amount in his individual capacity

or as partner of the firm will be considered infra.

19. In the plaint it was pleaded that defendant No.1

represented by defendant No.2 borrowed a sum of Rs.1,00,000/-

and having received the consideration, defendant No.2 executed

a letter on behalf of defendant No.1 firm on its letterhead and

affixed stamp of the firm in the presence of the attestors. It was

further averred that defendant No.2 represented that he would

repay the amount within a short period and failed to repay the

same.

20. Plaintiff examined himself as PW1. The chief-affidavit of

the plaintiff is nothing but replica of the plaint. He further

deposed in chief-examination that the plaintiff is having

business friendship with defendant No.2 and there were

previous transactions between them. During the course of

cross-examination, he deposed that defendant No.2 is one of the

partners of defendant No.1 firm. He further deposed that letter,

Ex.A1 discloses that defendant No.3 is the Managing Partner of

defendant No.1 firm and he denied the suggestion that

defendant No.2 is not partner of defendant No.1 firm. He further

deposed that all the defendants are close friends and he got

acquaintance with them for the last twenty years. When a

suggestion was put to PW1 with regard to non-payment of

consideration under Ex.A1, he denied the same and also denied

the suggestion that the suit was filed in collusion with

defendant No.3 in view of the disputes between defendant No.3

on one side and other partners of defendant No.1 firm on the

other side. He also deposed that he does not know whether

defendant No.2 borrowed the amount for his personal purpose

or on behalf of the firm and that defendant No.1 firm is a busy

shop with customers.

21. Against the said pleadings and evidence defendant No.2

examined him as DW1. Defendant No.2, in his written statement

contended that he is not partner of defendant No.1 firm and that

he executed Ex.A1 on the request made by the plaintiff and no

consideration was passed. According to defendant No.2 plaintiff

never demanded to repay the amount. In the cross-examination,

he admitted that he did fertilizers business for some time under

the name and style of M/s. Annapurna Agro Agencies,

Nandigama. Ex.A1 was scribed on the letterhead of

M/s. Sri Annapurna Fertilizers, Nandigama, whereas he is

Managing Partner of M/s. Annapurna Agro Agencies. He further

admitted in his cross-examination that defendant No.1 firm was

in the same premises where M/s. Annapurna Agro Agencies is

located. He also admitted that in the said M/s. Annapurna Agro

Agencies, apart from himself, one Mandadapu Venkateswarlu,

Chava Mangamma and Ganta Janaki Rammaiah were partners

and Chava Mangamma is wife and Ganta Janaki is father-in-law

of defendant No.3 in the present suit. Defendant No.4 in the

present suit is his brother and defendant No.5 is wife of

defendant No.4. He also admitted that his father is a partner of

M/s. Sri Annapurana Fertilizers.

22. M/s. Annapurna Agro Agencies and M/s. Sri Annapurna

Fertilizers are located in the same premises and the partners in

both the firms are closely related. The plea of plaintiff that

defendant No.2 borrowed the amount representing himself as

partner of defendant No.1 firm, in the absence of any positive

proof that defendant No.2 is partner of defendant No.1, may not

absolve the liability of defendant No.2 from discharging the debt.

In other words, merely because defendant No.2 is not partner of

defendant No.1, plaintiff will not be non-suited on that ground

alone, still defendant No.2 is personally liable to discharge the

debt. As stated supra the name of defendant No.1 is M/s. Sri

Annapurna Fertilizers and defendant No.2 is Managing Partner

in M/s. Annapurna Agro Agencies. Both the firms are located in

the same premises by carrying same kind of business. In view of

the similar names and carrying on similar type of business,

defendant No.2 might have represented before the plaintiff that

he is borrowing amount on behalf of defendant No.1 firm posing

himself as partner of defendant No.1. Of course it was pleaded

by defendant Nos.4 and 5 as also by defendant No.2 that

defendant No.2 is nothing to with defendant No.1 firm.

23. Defendant No.2 admitted execution of Ex.A1. In fact

defendant No.2 himself scribed Ex.A1. When defendant No.2

himself scribed Ex.A1, he has to explain under what

circumstances, he executed Ex.A1. Appellant/Defendant No.2

tried to explain in his written statement that the plaintiff

approached him with a request to execute a nominal promissory

note and out of friendship to accommodate the plaintiff, he

executed Ex.A1. He further stated in his written statement that

the document does not bind him and it is unenforceable against

him.

24. It is pertinent to mention here that Defendant No.2 is not

innocent or gullible person. He knows the consequences of

execution of Ex.A1 in view of his rich experience in court

litigation. According to him, being Managing Partner of M/s.

Annapurna Agro Agencies, he filed nearly 120 suits in

Nandigama Munsif Courts and Vijayawada Sub-Courts. Hence,

he is aware of the implications of Ex.A1. He also deposed in his

cross-examination that he gave evidence in all the suits and

concerned execution petitions on behalf of M/s. Annapurna

Agro Agencies. He also admitted that he got Court knowledge.

He further admitted that in the suits filed by him on behalf of

M/s. Annapurna Agro Agencies, Chava Suryaprakash,

defendant No.3 used to scribe batta memos, petitions, execution

petitions, etc., if necessary. He also further admitted that said

defendant No.3 used to collect E.P. amounts and he used to look

after execution of warrants for the firm. This apart the evidence

of DW2, makes the thing more than discernable that defendant

No.2 is conscious of the implications in executing Ex.A1. Having

been executed Ex.A1 on a letterhead of M/s. Sri Annapurna

Fertilizers, in which firm he is not partner, is trying to take

advantage. A person who filed nearly 120 suits and having court

experience in a normal course may not execute such letter like

Ex A1 unless he borrows amount. The contentions of defendant

No.2 that he has not borrowed the amount and in fact the

plaintiff brought paper and rubber stamp are unbelievable. As

noticed, both the firms are run in the same premises and

partners in both the firms are closely related. Thus, on a careful

consideration of evidence on record, this Court comes to the

conclusion that appellant/2nd defendant, though not partner of

defendant No.1 firm executed letter on the letterhead of

defendant No.1 firm at the time of borrowing of amount.

25. Since defendant No.2 is not partner in defendant No.1

firm, defendant No.1 firm is not liable to pay the amount under

Ex.A1. Defendant No.2 having borrowed the amount in his

individual capacity is liable to pay the amount. Though

defendant No.2 examined DW2, one of the attestors of Ex.A1,

his evidence does not inspire confidence of this Court.

26. On a careful evaluation of pleadings and evidence, it

seems, appellant/2nd defendant is trying to take advantage of

his own wrong which is impressible. It is settled principle of law,

that no person shall take advantage of his own. It is settled

principle of law that a man cannot be permitted to take undue

and unfair advantage of his own wrong to gain favourable

interpretation of law. To put it differently, "a wrong doer ought

not to be permitted to make a profit out of his own wrong

27. In Mrutunjay Pani and Anr. Vs. Narmade Bala Sasmal

and Anr.4, it was held that where an obligation is cast on a

party and he commits a breach of such obligation, he cannot be

permitted to take advantage of such situation. This is based on

the Latin Maxim 'Commodum ex injuria sua nemo habere debet'

(No party can take undue advantage of his own wrong).

28. In Ashok Kapil Vs. Sana Ullah5, it was held as under:

"7. .... The maxim "Nulls commode copier potest de injuries sua propriety" (No one can take advantage of his own wrong) is one of the salient tenets of equity.

Hence, in the normal course, appellant/D2 cannot secure

the assistance of a court of law for enjoying the fruit of his own

wrong.

1962 (1) SCR 290

1996 (6) SCC 342

29. The other contention raised by learned counsel for

defendant No.2 that the pleading of the plaintiff is consistent

that defendant No.2 borrowed amount on behalf of defendant

No.1 firm and hence, if the plaintiff failed to prove that

defendant No.2 is partner of defendant No.1 firm, the suit is

liable to be dismissed. In support of his contention, he relied

upon Allam Gangadhara Rao v. Gollapalli Gangarao.

30. It is settled principle of law that a party can succeed

according to what is alleged and proved and no relief can be

granted on the facts and documents not disclosed in the plaint.

The suit based on one cause of action cannot be decreed on

another cause of action. A party can only succeed according to

what was alleged and proved secundum allegate et probate.

31. Though it was pleaded in the plaint that defendant No.2

borrowed the amount on behalf of defendant No.1, as explained

supra, the names of both the firms are almost similar and both

the firms are located in the same premises. Defendant No.2

cannot take advantage of his own wrong and on that ground the

plaintiff would not be non-suited. The suit is one filed for

recovery of amount on the strength of Ex.A1 scribed by

defendant No.2. Since it was proved that appellant/D2

borrowed the amount and scribed Ex.A1, he is personally liable

to pay amount. The evidence on record probablizes that

defendant No.2 borrowed the amount in individual capacity, but

not on behalf of defendant No.1 firm. In fact, appellant/D2 is

not partner of 1st defendant firm. Therefore, other defendants

are not liable to pay the amount. The decisions relied upon by

learned counsel for appellant/defendant No.2 will not apply to

the facts of the present case. Thus, the appeal is liable to be

dismissed.

Point No.5:

32. In view of the above discussion, the judgment and decree

of the trial Court do not call for interference of this Court and

hence, the appeal is liable to be dismissed.

33. In the result, the appeal is dismissed with costs.

As a sequel, pending miscellaneous petitions, if any, shall

stand closed.

_______________________________ JUSTICE SUBBA REDDY SATTI Date : 30.04.2022

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HON'BLE SRI JUSTICE SUBBA REDDY SATTI

APPEAL SUIT No.2159 of 2001 30.04.2022

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