Visakhapatnam (For Short "The ... vs "Once The Execution Of The ...
2023 Latest Caselaw 3909 AP

       THE HON'BLE SRI JUSTICE T.MALLIKARJUNA RAO

                    APPEAL SUIT No.144 OF 2016

JUDGMENT:

1. Aggrieved by the Decree and Judgment dated 15.09.2014 in

O.S.No.78 of 2010 passed by the learned VI Additional Senior Civil Judge,

Visakhapatnam (for short "the trial Court"), the appellants/defendants

preferred this appeal questioning the correctness of the Decree and

Judgment passed by the trial Court.

2. For the sake of convenience, the parties will hereinafter be referred to

as arrayed in the Original Suit.

3. The plaintiffclaims that defendants 1 and 2, who are the husband and

wife,jointly borrowed Rs.5,00,000/- from the plaintiff on 28.04.2008 for

their business purpose and to purchase lands, and they together executed

a promissory note in favour of the plaintiff, agreeing to repay the same with

interest at 24% per annum. Despiterepeated demands made by the

plaintiff, the defendants failed to repay the said amount. Later, the plaintiff

got issued a legal notice on 30.11.2009 to the defendants; having received

the same, neither they gave a reply nor discharged the said debt.

4. The 1st defendant filed a written statement, which the 2nd defendant

adopted by filing an adoption memo. The 1st defendant denies the

allegations made in the plaint and contends that he is an Advocate by

profession and Notary. The plaintiff approached the 1st defendant in 2007

to acquire lands in NGR Puram Village from various Ryots by purchasing

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an extent of Ac.8.00 at Rs.4900/- per cent. The plaintiff paid some

amounts as advance to the land owners.Subsequently, due to the downfall

in the real estate business, there was a shortfall in the value of the

lands;the plaintiff was unable to pay the remaining balance sale

consideration and insisted that the land owners a refund of the advance

amount, but they did not;Later, the plaintiff approached the 1st defendant

to exercise his influence, but the 1st defendant expressed his inability to

interfere. Then, the plaintiff bore a grudge against him and fabricated the

suit pronote andother pronotes by forging the defendants' signatures and

filing the claim.

5. Based on the above pleadings, the Trial Court framed the issues as

well as additional issues, which are as under:-

1) Whether the plaintiff is entitled to recover the suit amount or not?

2) Whether the suit pronote is true, valid and binding on the defendants or not?

3) To what relief?

Additional Issue:

Whether the suit promissory note is not supported by consideration?

6. On behalf of the plaintiff, P.Ws.1 to 3 were examined and marked

Exs.A1to A4, and on behalf of the defendants, D.Ws.1 to 4 were examined,

and Exs.C.1 to C.12 were exhibited through an expert/D.W.4 on behalf of

the defendants.

7. After considering the evidence on record, the trial Court decreed the

suit with costs for Rs.7,00,000/- with interest @ 12% per annum from the

date of suit till the date of decree and thereafter @ 6% per annum from the

T.M.R.,J A.S No.144 of 2016

date of decree till the date of realization on the principal amount of

Rs.5,00,000/-.

8. I have heard the arguments of learned counsel for both parties.

9. Sri Aravala Rama Rao, learned counsel representing the

appellants/defendants, contends that the trial Court overlooked crucial

aspects. He asserts thatthe respondent/plaintiff developed a grudge

against the 1st appellant and fabricated the suit promissory note, along

with other forged promissory notesby forging the 1st appellant‟s signature;

notably, the attestors and Scribe are the plaintiff‟s followers, casting doubt

on their credibility; the appellants never executed any promissory notes in

favour of the plaintiff; there was no necessity to borrow such amount. He

further asserts that the plaintiff cannot claim such an amount and has no

chance to lend the money on the multiple promissory notes (totaling 12 in

number);the respondent/plaintiff did not file Income Tax returns. He

further asserts that the 1st appellant functioned as an intermediary, when

the plaintiff approached the 1st appellant to acquire land in N.G.R.Puram

village; later, the plaintiff did not come forward to pay the balance sale

consideration and insisted on returning the advance, but the Ryots did not

accept.

10. Per contra, Sri P.V.Ramana learned Counsel for the respon-

dent/plaintiff would contend that the trial Court correctly appreciated the

facts of the case and reached a correct conclusion. The reasons given by

the trial Court do not require any modifications.

T.M.R.,J A.S No.144 of 2016

11. Having regard to the pleadings in the suit, the findings recorded by

the trial Court and in the light of the rival contentions and submissions

made before this Court, the points that would arise for determination are:

1) Whether the Trial Court justified in holding the execu-

tion of Ex.A.1-promissory note on receipt of consideration by the defendants in favour of the plaintiff?

2) Whether the Judgment passed by the trial Court needs any interference?

POINT NOs.1 & 2:

12. The plaintiff is examined as P.W.1. The 1st defendant is examined as

D.W.1. The 2nd defendant is the wife of 1st defendant. To prove the Ex.A1

suit transaction, the plaintiff also got examined P.W.2-Ch. Bhaskara

Rao/Attestor, and P.W.3-V. Gowreswara Rao. P.Ws.1 to 3 deposed that

both the defendants borrowed Rs.5,00,000/- from the plaintiff on

28.04.2008 and executed Ex.A1 promissorynote on receipt of consideration

amount thereunder. Evidently, the plaintiff got issued a legal notice [Ex.A2]

to the defendants calling upon them to pay the amount payable under

Ex.A1 promissory note with interest. To show the receipt of the legal notice,

the plaintiff relied on Ex.A3 and Ex.A4 acknowledgements. It is the

defendants' stand that the plaintiff forged the defendants' signatures and

fabricated Ex.A1 promissory note.Evidently, P.W.1 and D.W.1 jointly

carried on the coconut and cashew business for about 14 to 15 years as

partners, and 1st defendant is an advocate by profession. P.W.1 was cross-

examined regarding his financial capacity to lend the amount covered

under Ex.A1. The evidence of P.W.1 shows that he owns Ac.2.00 of the

T.M.R.,J A.S No.144 of 2016

land. According to his evidence, the suit transaction occurred at

Lawsonsbay colony, Jalaripet, at his house. The recordalso discloses that

the plaintiff filed suits against the defendants based on the other six

promissory notes.

13. P.W.2 testified in cross-examination that the defendants borrowed

amounts from the plaintiff twelve times in 2007-2008 within a gap of one or

two months. At eight times, the defendants borrowed amounts of

Rs.5,00,000/- each and the remaining promotes concerned, D.1 and D.2

borrowed Rs.2,00,000/- each under two promissory notes and

Rs.4,00,000/- under the remaining two promissory notes. The evidence of

P.W.2 coupled with Ex.A1 shows that he attested the promissory note.

14.P.W.3, the Scribe of the promissory note, also deposed that D.1 and D.2

executed twelve promissory notes in 2007-2008. P.W.3 expressed ignor-

ance as to whether there aresuits filed by the plaintiff other than six suits.

The cross-examination of P.Ws.1 to 3 appears to be regarding the other

transactions also. It is not much relevant and proper to deal with the con-

tentions regarding the other transactions.

15. It is thedefendants case that during the year 2007, the plaintiff ap-

proached D.1 to acquire lands in NGR Puram village from various ryots to

the extent of Ac.8.00 @ Rs.4900/- per cent, and the 1st defendant acted as

mediator; the plaintiff paid some amounts to land owners and subsequently

there was a downfall in the real estate business; and the plaintiff was una-

ble to pay the balance amount, and insisted the land owners refund the

T.M.R.,J A.S No.144 of 2016

amount, but they did not pay the amount; plaintiff insisted 1st defendant to

exercise his influence and 1st defendant expressed his inability and the 1st

defendant advised the plaintiff to pay the balance amount, the plaintiff de-

veloped a grudge against D.1 and fabricated the pronote by forging the de-

fendant‟s the signature. Having taken such pleas, defendants should not

dispute the financial capacity.

16. To establish their case, the defendants got examined D.W.2-G. Chinna

Rao and D.W.3-L.Appala Naidu. D.Ws.2 and 3 supported the defendant's

stand in the chief examination. However, as noted correctly by the trial

Court, their accounts diverged during cross-examination. In contrast to the

earlier version,D.W.2‟s cross-examination revealed a completely different

version. He testified that the transaction had occurredsolely between him-

self and D.1 with no sale transaction taking place between him and the

plaintiff in 2007.DW.2‟s testimony indicated that the plaintiff acquired

approximately Ac.8.00 of the land from his six paternal uncles. Notably,

D.1 has raised questionsregarding the plaintiff‟s failure to pay the remain-

ing sale amount. Additionally, D.W.2 revealed he had often enquired with

D.1 due to the sale transaction between him and D.1. Upon cross examina-

tion, D.W.2‟s testimony did not align with the defendants‟ case as con-

tended in the suit.

17. Regarding the DW.3‟s cross examination, he also affirmed that he

lacked personal knowledge concerning the financial transactions involving

the plaintiff and D.1. In contrast, the 1st defendant failed to show that the

T.M.R.,J A.S No.144 of 2016

plaintiff entered into sale transactions with the farmers of NGR Puram

accompanied by an advance payment to those farmers. If there is truth in

the 1stdefendant‟s version; he could have examined the farmers, who en-

tered into agreement with the plaintiff. As such, this Court finds that the

defendants failed to establish the plea of developing a grudge against him.

Furthermore, the defendants have not provided a substantial basis for the

alleged grudge against the plaintiff. Notably, the 1stdefendanthas not as-

serted that he has undertaken the responsibility of collecting amounts from

the farmers. It becomes difficult to accept the defendants‟ contention that

the plaintiff forged the promissory notes. Furthermore, there is no indica-

tion from the defendants that the disputes arose between them and the

plaintiff concerning their coconut and cashew business.

18. Whenever a party disputes the signature on the particular document,

two remedies are open to him either to request the Court to compare the

signatures or to file an application to send the document to the expert for

comparison. No doubt, the Handwriting Expert's opinion is not the final

word on the issue and is not conclusive, but it can be taken as a corrobora-

tive piece of evidence. As there is a serious dispute about the genuineness

of signatures on the Ex.A1 promissory note, the Expert opinion would go a

long way in resolving the controversy. An Expert is not a witness of fact,

and his evidence is advisory.The defendants examined D.W.4-Narendra

Singh, an Expert, whose evidence was recorded by an Advocate-

Commissioner and Ex.C1 to Ex.C12 documents were marked through the

Expert. The Expert gave his opinion, stating that the disputed signatures of

T.M.R.,J A.S No.144 of 2016

Q.1 and Q.2 are quite similar to the admitted signatures available on

Vakalat, Suit summons and specimen signatures obtained in open Court.

In his opinion, the signatures were written freely in disputed signatures

and do not show any sign of imitation or disguise. The similarities are seen

in the formation of 'S', „m‟ 'h', 'l', and 'i', as well as habit of writing

Simhachalam. The similar habit of the apex of „h‟, „k‟, execution of „m‟, as

well as combination of „ha‟, „la‟, „Si‟.The Expert offered comprehensive

reasoning to support his conclusion. No substantive evidence was brought

forth to cast a doubt on the Expert‟s testimony.

19. In Ram Narain v. State of Uttar Pradesh1, the Hon‟ble Apex Court

considered Section 45 of the Evidence Act and the circumstances under

which the evidence of an expert can be accepted by the Court and con-

cluded as under:

"...But this opinion evidence, which is relevant, may be worthy of accep- tance if there is internal or external evidence relating to the document in question supporting the view expressed by the expert. If after compari- son of the disputed and admitted writings by the Court itself, when the presiding officer is familiar with that language, it is considered safe to accept the opinion of the expert then the conclusion so arrived at cannot be assailed on special leave on the mere ground that comparison of handwriting is generally considered as hazardous and inclusive and that the opinion of the handwriting expert has to be received with con- sideration caution."

AIR 1973 SC 2200

T.M.R.,J A.S No.144 of 2016

20. In Vadrevu Annapurnamma v. Vadrevu Bhima Sankara Rao And

Others2, the Composite High Court of Andhra Pradesh at Hyderabad ob-

served thus:

"There are many factors which have to be taken into consideration in ef- fecting a comparison of the two signatures, and although a Court could apply its own eyes and its own mind to determine whether a particular signature is resembling another it would be going beyond the ordinary limits of the capacity of a Court to constitute itself as a Handwriting Ex- pert and try to compare the signature without all the gadgets and devic- es which are available to a Handwriting Expert, besides the lack of ex- pert knowledge which a Handwriting Expert possesses." The above legal position makes it clear that the expert's opinion is not excluded from the purview of examination and it was opined that it will help the Court in exercising power of comparison under Section 73 of the Evidence Act.

21. At this stage, it is apposite to refer to State of Maharashtra v.

Sukhdev Singh3, wherein it was held as follows:

"In cases where the reasons for the opinion are convincing and there is no reliable evidence throwing a doubt, the uncorroborated testimony of a handwriting expert may be accepted."

"It would, therefore, not be fair to approach the opinion evidence with suspicion but the correct approach would be to weigh the reasons on which it is based. The quality of his opinion would depend on the soundness of the reasons on which it is founded. But the court cannot afford to overlook the fact that the science of identification of Handwriting is an imperfect and frail one as compared to the science of identification of fingerprints."

"No hard and fast rule can be laid down in this behalf but the Court has to decide in each case of its own merits what weight it should attach to the opinion of the expert."

22. In order to satisfy myself, I have seen the admitted and disputed sig-

natures of the defendants. I have no reason to doubt the Expert‟s opinion,

1960 AIR (AP) 359

(1992) 3 SCC 700

T.M.R.,J A.S No.144 of 2016

as the signatures appear similar. The evidence of DW.4-Expert, therefore, is

duly corroborated by the evidence of PWs.2 and 3.

23. The Expert opiniondoes not conflict with the evidence of P.Ws.1 to 3

regarding the execution of the promissory note by the defendants. The

reasons for the opinion are convincing, and there is no reliable evidence

throwing doubt. The report of the Expert cannot be overlooked by taking

into consideration that the science of identification of Handwriting is an

imperfect and frail one. This Court finds no valid reason to differ the Expert

opinion. There was no acceptable direct testimony which was destructive of

the Expert‟s opinion. There were no features also which made the Expert‟s

opinion unreliable.

24. The evidence of PW.1 to PW.3 clearly shows that the defendants have

subscribed their signatures on the Ex.A.1-promissory note and received the

consideration. Once those materials were available,naturally, the presump-

tion under section 118 of the Negotiable Instruments Act would come into

play.

25. In G. Venkata Rama Subbaiah Vs. D. Rasool Naik4, the composite

High Court of Andhra Pradesh held thus :

"Once the execution of the promissory note is admitted or proved, then it is presumed to be supported by consideration unless contrary is proved. The burden is on the defendant to rebut the same by adducing convincing evidence. Unless the defendant rebuts the presumption by adducing convincing rebuttal evidence, the evidential burden would not shift back to the plaintiff who has legal burden only

2003 (4) ALT 414

T.M.R.,J A.S No.144 of 2016

after adducing such convincing rebuttal evidence, it can be held that thereafter the presumption under Section 118 does not come to the rescue of the plaintiff."

26. In a decision Bonalaraju V. S. SarupulaSrinivas5, the composite High

Court of Andhra Pradesh held that:

"once execution is proved the presumption under Section 118 of N.I. Act that it is supported by consideration automatically applies and the contention that the plaintiff is not only to establish the execution but also establish passing on the consideration is rejected".

27. In a decision Abbisetti Krishnamoorthy V. Singasani Raghura-

maiah (died) per L.R.s6, the composite High Court of Andhra Pradesh held

that:

"Section 118 of the N.I Act shows that the presumption attached to passage of consideration (as is the subject matter of this Appeal) just like other presumption also is clearly rebuttable and it is for the defendant to satisfy the Court that in a given case, the presumption cannot be drawn".

28. Having regard to the evidence, which is adverted to supra, this Court

views that the defendants do not show satisfactory and reliable evidence or

circumstance to disbelieve the evidence of PWs.1 to 3 regarding the

execution of the Ex.A.1 promissory note by the defendants and passing of

consideration. The evidence of PWs.1 to 3 is consistent regarding the

execution of the Ex.A.1 promissory note by the defendants on receipt of the

consideration amount. Though PWs.1 to 3 were subjected to lengthy cross-

examination, nothing was elicited to discredit their evidence. The plaintiff

and his witness have no reason to fabricate the suit promissory notes.

PWs.2 and 3 have no reasons to depose falsehood against the defendants‟

2006(2) ALD 202

2011(5) ALT 143

T.M.R.,J A.S No.144 of 2016

interest. They gain nothing by supporting the plaintiff‟s case unless there is

a truth. However, even the rebuttal could be given by direct evidence or by

proving the preponderance of probabilities.

29. In the present case, the defendants have not rebutted the presump-

tion, even by the preponderance of probabilities. The evidence of PWs.1 to 3

establishes the execution of Ex.A.1 promissory note. The burden lies on the

defendants to prove the non-existence of consideration by bringing on

record such facts and circumstances, which would lead the Court to believe

the non-existence of the consideration. Suppose the defendants have

discharged the onus of proof showing that the existence of consideration

was improbable or doubtful and the execution of the promissory note, the

onus would be shifted to the plaintiff. Then they will be obliged to prove the

existence of the consideration.

30. On studied scrutiny, it is seen that the defendants have not produced

any evidence to discharge the onus on him. The defence taken by the

defendants is not substantiated. The defendants have failed to prove their

contention regarding non-passing of consideration under Ex.A.1 by leading

cogent evidence. The presumption under section 118 of the Negotiable

Instruments Act 1881 is a statutory one, and unless it is rebutted, it has to

be presumed that consideration has passed.

T.M.R.,J A.S No.144 of 2016

31. For the reasons stated above, this Court is of the opinion that the

plaintiff is able to establish the execution of the suit promissory note, in his

favour, by the defendants after receipt of the consideration amount

thereunder.

32. After careful consideration, the trial Court had adequately

appreciated the evidence. There is no reason for this Court to arrive at a

different conclusion than the one arrived at by the trial Court. I am of the

opinion that the findings arrived at by the trial Court are absolutely correct,

and no justifiable reasons have been shown by the appellants/defendants

for arriving at different conclusions. I agree with the conclusion reached at

by the trial Court.

33. Accordingly, the Points are answered in favour of the plaintiff by

holding that the Trial Court is justified in holding that the defendants

executed the suit promissory note and received the consideration amount

there under. Given the preceding discussion, the view taken by the trial

court does not call for any interference and this Appeal fails and is hereby

dismissed. The impugned Decree and Judgment passed by the trial court is

upheld.

34. As a result, the Appeal is hereby dismissed without costs by

confirming the Decree and Judgment dated 15.09.2014 in O.S.No.78 of

2010, passed by the learned VI Additional Senior Civil Judge,

Visakhapatnam.

T.M.R.,J A.S No.144 of 2016

Consequently, miscellaneous petitions pending, if any, in this Appeal

shall stand closed.

_________________________________ JUSTICE T. MALLIKARJUNA RAO

Date:22.08.2023 MS

T.M.R.,J A.S No.144 of 2016

THE HON'BLE SRI JUSTICE T.MALLIKARJUNA RAO

APPEAL SUIT NO.144 OF 2016

Date:22.08.2023

MS