Chattisgarh High Court
M/S G. K. Developers vs Smt. Purnima on 16 February, 2023
FA No. 400 of 2018
M/s G. K. Developers & anr. Vs. Smt. Purnima
1
AFR
HIGH COURT OF CHHATTISGARH, BILASPUR
FA No. 400 of 2018
1. M/s G. K. Developers (Registered Partnership Firm) Achholi Kanhera
Road, Urla, Police Station Urla, Tahsil And District Raipur Chhattisgarh
2. Mahendra Gupta, Aged About 41 Years, Through Partner Suresh Atlani,
Aged About 56 Years, S/o Late Golaram Atlani, R/o Office No. 8,
Ground Floor, Ashoka Millennium, Ring Road, New Rajendra Nagar,
Raipur, Tahsil And District Raipur Chhattisgarh (Defendants)
---- Appellants
Versus
Smt. Purnima W/o Shri C.P. Jain, Aged About 60 Years R/o Flat No.
501, Amaltas, D.M. Vatika, Khamhardih, Raipur, Chhattisgarh.
Presently Through Sumesh Jain, House No. 2168, Shanta Klara,
Esperenaka Enue, California (USA) 95054.
Through Power of Attorney Brijbhushan Lal Jain, Aged About 59 Years,
S/o Shiromanichand Jain, R/o Pushpak Nagar, Street No. 3, Durg,
District Durg Chhattisgarh. (Plaintiff)
---- Respondent
For Appellants : Shri Arvind Shrivastava, Advocate
For Respondent : Shri Prafull N. Bharat, Sr. Adv. Along with
Shri Harshal Chauhan, Advocate
Hon'ble Shri Justice Goutam Bhaduri
Hon'ble Shri Justice N.K. Chandravanshi
Judgment on Board
Per Goutam Bhaduri, J.
16/02/2023
Heard.
1. The present appeal is against the judgment and decree dated
25/01/2018 passed by the 5th Additional District Judge, Raipur in
Civil Suit No.24B/13, whereby the suit filed by the respondent
FA No. 400 of 2018
M/s G. K. Developers & anr. Vs. Smt. Purnima
was decreed for Rs.10 Lakhs along with interest @ 6% p.a. from
08/03/2013.
2. The defendant being aggrieved by such judgment and decree has
filed this appeal.
3. The plaintiff Smt. Purnima filed a suit on the ground that a joint
account was opened by her mother Indurani Dhadda & father
B.L. Dhadda on 04/02/2011 at Bank of Baroda, Raipur. The
account was to be operated by either of the account holder.
Plaintiff further stated that the defendant firm through his partner
Suresh Atlani requested for a loan from plaintiff of Rs.10 Lakh on
17/02/2011. It was further stated that defendant agreed to pay an
interest @ 18% p.a. Accordingly, an amount of Rs.10 Lakhs by
way of loan was advanced to Suresh Atlani and in the said cheque
the joint account holder Smt. Indurani Dhadda had signed it and
after receipt of the money a promissory note of 17/02/2011 was
executed by Suresh Atlani in favour of Smt. Indurani Dhadda.
4. The plaintiff contended that on two occasions i.e. on 23-2-2011
and 23-5-2011 an amount of Rs.27,000/-, respectively, was paid
by way of interest but subsequently no repayment was made. Then
plaintiff made a demand of Rs.10 Lakhs to liquidate the loan,
wherein the defendant had issued a cheque of Rs.10 Lakhs on
18/06/2012 in name of her mother. The said cheque was
FA No. 400 of 2018
M/s G. K. Developers & anr. Vs. Smt. Purnima
deposited in the joint account of the plaintiff, her mother and
father but it got dishonoured. Thereafter, legal notice was served
to the defendant on 04/07/2012 despite that no payment was
made, therefore, eventually, the suit was filed.
5. Per contra, the defendant denied to have received the loan and
consequently denied to have executed the promissory note. The
averments and allegation also of payment of Rs.27000/- at two
occasions by way of interest was also denied. In continuation, the
service of notice and the reply too was also denied.
6. On the basis of the pleading, issues were framed and plaintiff
examined herself and the defendant examined witness Suresh
Atlani. The trial Court came to a finding of transaction took place
in between the parties and decreed the suit in favour of the
plaintiff. Hence this appeal.
7. Learned counsel for the appellants would submit that the
institution of the suit by Smt. Purnima Jain would be bad as
neither any transaction took place in between Smt. Purnima Jain
and the appellant nor any promissory note was executed in her
favour. He would further submit that the promissory note (Ex.
P/8) would show that it was in name of Smt. Indurani Dhadda
and there being no endorsement in the promissory note, plaintiff
cannot be a holder in due course. He would further submit that
FA No. 400 of 2018
M/s G. K. Developers & anr. Vs. Smt. Purnima
learned trial Court has completely misdirected itself to draw a
presumption under Section 118(g) of the Negotiable
Instruments Act, 1881 (hereinafter referred to as "NI Act")
which is rebuttable in nature and the very document on which
the suit is based i.e. promissory note and subsequent cheque
which was issued in name of the mother of the plaintiff would
show that there was no privity of transaction in between
plaintiff and defendant. He placed his reliance in the case of
Pradeep Kumar and Another v Postmaster General and
Others reported in (2022) 6 SCC 351 to submit that holder in due
course cannot be presumed and would submit that in order to be a
holder in due course either it should be for consideration and the
exchange of instrument should be before the amount became
payable. He would further submit that in this case, the amount
became payable on 18/06/2021 when the cheque issued in favour
of the mother of the plaintiff was dishonoured. Therefore, the
plaintiff cannot be a holder in due course and the case is liable to
be dismissed.
8. Per contra, learned counsel for the respondent would submit that
the ground which is raised before this appellate Court was neither
pleaded nor agitated before the trial Court. He would further
submit that the respondent cannot be taken by surprise to allow
the appellant to agitate those grounds when they were not pleaded
FA No. 400 of 2018
M/s G. K. Developers & anr. Vs. Smt. Purnima
and when the issues were not framed. He would further submit
that the case of the plaintiff was that from the joint account the
amount was given and the case was not based on promissory note
and it was only an additional feature for security. Therefore, the
decree passed by the Court below is well merited which do not
call for any interference.
9. We have heard learned counsel for the parties and perused the
record.
10.Perusal of the record would show that the suit was filed by Smt.
Purnima. According to the pleading the loan was given from the
joint account and thereafter a promissory note of Rs.10 Lakhs was
executed on 17/02/2011 in favour of the one of the joint account
holder Smt. Indurani Dhadda. The submission of the respondent,
therefore, that the promissory note was ancillary security of loan
is against the pleading made before the trial Court. Be that as it
may, we went through the pleading, evidence and the respective
sections of NI Act.
11. Admittedly, as per documents which are filed, Ex. P/8 is a
promissory note of Rs.10 Lakhs issued in favour of Smt. Indurani
Dhadda. The defendants have completely disowned those facts
that they have received any amount but no evidence has been
placed to support the same. On the contrary, the plaintiff stated
FA No. 400 of 2018
M/s G. K. Developers & anr. Vs. Smt. Purnima
that Rs.10 Lakhs of loan was advanced from a joint account and
the accounts were in name of plaintiff i.e. Smt. Purnima along
with her mother Indurani Dhadda and father B.L. Dhadda.
According to the plaintiff, the account was a joint account and was
operated by either of the account holder. The statement of the
defendant would show in cross-examination, it was admitted that
he had received a cheque of Rs.10 Lakhs as he was in need of
money for his business. He further admitted that after receipt of
the cheque he executed a promissory note of Rs.10.00 lacs on
17-2-2011.
12.The plaintiff stated that after the advance of cheque, by way of
repayment on two occasions i.e. 23-2-2011 and 23-5-2011 a
cheque was received by her i.e. Smt. Purnima Jain and total
amount of Rs.54,000/- was deposited in the joint account. The
defendant at para 11 of the statement says that he had paid amount
of interest to Indurani by way of a cheque. According to the
plaintiff, thereafter, she demanded the money of Rs.10.00 lacs and
having made the demand, a cheque of Rs.10.00 lacs was given to
her on 18-6-2012, which was deposited in their bank, which got
dishonoured. Thereafter, a notice (Ex.P/5) dated 16-7-2012 was
served. Perusal of notice Ex.P/5 would show that the notice was
served on behalf of Indurani Dhadda, B.L. Dhadda and Purnima
Jain in whose favour the promissory note was executed. The said
FA No. 400 of 2018
M/s G. K. Developers & anr. Vs. Smt. Purnima
cheque having been deposited in the account got dishonoured,
which is also proved by PW-2 Tusharkant Sahu, Senior Manager
of the Bank, for want of sufficient fund. According to the
statement of PW-2 Tusharkant Sahu it would show that the cheque
of Rs.10.00 lacs was deposited in the joint account of Indurani
Dhadda, B.L. Dhadda and Purnima Jain. The facts, therefore,
show that initially the plaintiff who was holding the joint account
with Indurani Dhadda and B.L. Dhadda, an amount of Rs.10.00
lacs was given as a loan for which on two occasions interest was
deposited and subsequently after demand the cheque was given
which having deposited in the joint account was dishonoured.
13. Admittedly, the suit is filed by Purnima Jain. The question looms
large as to whether she would be holder in due course as per
Section 9 of the NI Act and whether the presumption of Section
118(g) can be drawn that by mere holder of a negotiable
instrument she would be holder in due course. In order to explore
this, Sections 9 and 118 (g) of the NI Act would be relevant,
which are quoted below for ready reference :
9. Holder in due course".--"Holder in due
course" means any person who for consideration
became the possessor of a promissory note, bill of
exchange or cheque if payable to bearer, or the
payee or indorsee thereof, if payable to order, before
the amount mentioned in it became payable, and
without having sufficient cause to believe that any
defect existed in the title of the person from whom
he derived his title.
FA No. 400 of 2018
M/s G. K. Developers & anr. Vs. Smt. Purnima
118. Presumptions as to negotiable instruments.
--Until the contrary is proved, the following
presumptions shall be made:--
xxx xxx xxx
(g) that holder is a holder in due course
--that the holder of a negotiable instrument is
a holder in due course:
First part of Section 9 of the NI Act purports that 'holder in
due course" means any person who for consideration became the
possessor of a promissory note. In the instant case, it is established that
the amount was advanced from the joint account. Subsequent thereto the
Section purport that holder in due course would be the person who is in
hold of the negotiable instrument before the amount mentioned in it
became payable.
14. PW-1 Smt. Purnima Jain in her evidence categorically stated that
after the advance made from the joint account a promissory note was
issued in favour of the mother. The amount having been debited or
withdrawn from the joint account it cannot be stated and presumed that
she being the joint holder of the account did not have any right over such
amount. Apart from that the evidence of PW-1 Purnima Jain would
show that repayment of Rs.27,000/- by way of interest was made to her.
This also draws inference that before the demand was made she came in
possession of the promissory note and further the evidence would show
that she has stated that she made a demand to Suresh Atlani for
repayment. Thereafter, the cheque of Rs.10.00 lacs was issued
FA No. 400 of 2018
M/s G. K. Developers & anr. Vs. Smt. Purnima
consequently she became the holder of negotiable instrument i.e.
promissory note before the amount mentioned in it became payable.
15. Section 118 (g) of the NI Act which covers the special rule of
evidence and Section 118 (g) purport that it would be presumed that the
holder of a negotiable instrument is a holder in due course.
16. The Supreme Court in the matter of Pradeep Kumar and
Another v Postmaster General and Others reported in (2022) 6 SCC
351 while interpreting the 'holder in due course' has held that as per
Section 9 'holder in due course' is a person who for consideration has
become a possessor of the instrument if payable to a bearer or if payable
to the order to the person mentioned, i.e. the payee, or becomes the
indorsee thereof. It further explained that holder in due course means
the original holder or a transferee in good faith, who has acquired
possession of the negotiable instrument for consideration without having
sufficient cause to believe that there was any defect in the title of the
person and the negotiation in case of transfer should be before the
amount mentioned in the negotiable instrument becomes payable.
17. As has been held that a negotiation of the instrument had already
taken place, as the evidence of plaintiff remains unrebutted that amount
of Rs.27,000/- twice was paid to her before it became due and after the
payment the cheque was issued in the name of her mother which got
dishonoured. The evidence suggest that the amount was parted from a
joint account of plaintiff, her mother Indurani and father B.L. Dhadda
FA No. 400 of 2018
M/s G. K. Developers & anr. Vs. Smt. Purnima
would go to show that she was holder in due course before the amount
became payable. Therefore, the presumption of Section 118 (g) of the
NI Act would follow and the custody of cheque by plaintiff was without
any fraud or any offence, Section 47 of the NI Act also support the fact
that the negotiable instrument can be negotiated through delivery and no
exception has been brought fore to hold it otherwise.
18. In a result, we are of the view that the impugned judgment and
decree passed by the Court below is well merited warranting no
interference of this Court.
19. Accordingly, the present appeal is dismissed, leaving the parties to
bear their own cost(s).
20. A decree be drawn accordingly.
Sd/- Sd/-//--
(Goutam Bhaduri) (N.K. Chandravanshi)
Judge Judge
Ashu
