[Cites 10, Cited by 0]
Chattisgarh High Court
Lalwani And Sons vs Firm Cheema Bricks Wrongly Mentioned As ... on 18 March, 2026
Author: Ramesh Sinha
Bench: Ramesh Sinha
1
2026:CGHC:12839-DB
Digitally signed
by SAGRIKA
SAGRIKA AGRAWAL
AGRAWAL Date:
2026.03.18
AFR
18:11:28 +0530
HIGH COURT OF CHHATTISGARH AT BILASPUR
Judgment Reserved on : 13.03.2026
Judgment Delivered on : 18.03.2026
FA No. 549 of 2017
Lalwani And Sons Through Its Prop. Kalyan Dad Lalwani, S/o Late
Ruchandmal Lalwani, Aged About 57 Years, R/o Nehru Nagar Main
Road, Bilaspur, Tahsil And District Bilaspur Chhattisgarh , Chhattisgarh
... Appellant(s)
versus
1 - Firm Cheema Bricks Wrongly Mentioned As Brieks Through Its
Partners Jagveer Singh Chima S/o Sohan Singh Chima, Aged About 35
Years C/o Chima Local Carrier Shankar Nagar Raipur Road
Mahasamund, Tahsil And District Mahasamund Chhattisgarh,
Chhattisgarh
2 - Gurumukh Singh Chima, S/o Gurucharan Singh Chima, Aged About
42 Years C/o Chima Local Carrier Goyal Complex Shop No. 09,
Minocha Petrol Pump Telibandha Mahsamund Road Raipur, Tahsil And
District Raipur Chhattisgarh , District : Raipur, Chhattisgarh
3 - Jaspal Singh Chima, S/o Sohan Singh Chima, Aged About 40 Years
C/o Chima Local Carrier Shankar Nagar Raipur Road Mahasamund,
Tahsil And District Mahasamund Chhattisgarh , District : Mahasamund,
Chhattisgarh
2
4 - Jagroop Singh Chima, S/o Sohan Singh Chima, Aged About 40
Years C/o Chima Local Carrier Shankar Nagar Raipur Road
Mahasamund, Tahsil And District Mahasamund Chhattisgarh, District :
Mahasamund, Chhattisgarh
... Respondent(s)
For Appellant(s) : Mr. Kalyan Das Lalwani, Appellant In Person.
For Respondent(s) : Mr. Manoj Paranjpe, Sr. Advocate along with
Ms. Shivangi Agrawal, Advocate.
Hon'ble Shri Ramesh Sinha, Chief Justice
Hon'ble Shri Ravindra Kumar Agrawal, Judge
CAV Judgment
Per Ramesh Sinha, Chief Justice,
1. Heard Mr. Kalyan Das Lalwani, Appellant In Person. Also heard
Mr. Manoj Paranjpe, Sr. Advocate along with Ms. Shivangi Agrawal,
Advocate, appearing for the Respondents.
2. The appellant/ plaintiff has filed the instant appeal under Section
96 of the Code of Civil Procedure, 1908, challenging the impugned
judgment and decree dated 23.08.2017 passed by the learned
Additional District Judge, Bilaspur, in Civil Suit No. 1-B/2013, whereby
the civil suit filed by the appellant/ plaintiff for recovery of Rs.
21,18,500/- has been dismissed.
3. The appellant/plaintiff filed a civil suit seeking recovery of Rs.
21,18,500/- from the defendants, with the pleading that he was engaged
in the coal business, purchasing coal from SECL through e-auction and
selling it to various parties. The defendants, who are operating a brick
kiln at Mahasamund, required coal for their kiln operations and had
agreed on terms and conditions for its supply with the plaintiff. In the
year 2011-12, the plaintiff sold 2793.270 MT of coal, amounting to Rs.
78,35,046/-, on credit, and the details of which are annexed
as Schedule-1. In the year 2012-13, the defendants purchased 500 MT
of coal, amounting to Rs. 15,29,855/-, from the plaintiff, which was lifted
from Laxman Colliery of SECL through DO No. 121384 dated
24.03.2012, the details of which are given in Schedule-2 of the plaint.
The plaintiff further pleaded that the details of the vehicles used for
transporting the coal were provided in Schedule-3, while the actual
transportation of coal for the year 2011-12, as per Schedule-1, was
recorded in Schedule-4. Since the defendants were local transporters,
they arranged for the transportation of the coal using their own trucks.
The plaintiff claimed that although the defendants purchased coal
amounting to Rs. 78,35,046/- on credit in 2011-12, they paid only Rs.
58,05,000/-, leaving an outstanding balance of Rs. 20,30,046/-, as
detailed in Schedule-5 annexed with the plaint. This formed the basis of
the recovery claim in the suit.
4. It is further pleaded that in the year 2012-13, the defendants
purchased coal from the plaintiff, amounting to Rs. 15,29,855/- on
credit. However, the defendants paid Rs. 17,14,700/-, the details of
which are given in Schedule-6 annexed with the plaint. After adjusting
the payments made by the defendants, the total outstanding
amount comes to Rs. 18,45,201/-. The plaintiff stated that he made
several efforts, including telephone calls, requesting the defendants to
pay the balance amount, but the defendants evaded payment.
Subsequently, the plaintiff served a legal notice through his counsel,
which was replied to by the defendants denying any liability. As a result
of the outstanding dues, the plaintiff filed the civil suit seeking recovery
of Rs. 18,45,201/-, along with damages of Rs. 2,73,300/- and interest at
the rate of 18% per annum.
5. The defendants, upon service of summons, filed their written
statement denying the claim of the plaintiff. They admitted that they had
purchased a total of 2793.270 MT of coal in the year 2011-12,
amounting to Rs. 78,35,046/-, but denied the accuracy of the Schedules
annexed with the plaint. While admitting the coal purchases from the
plaintiff, they contended that the price for the coal had been paid
regularly. According to the defendants, in the year 2011-12, they
purchased coal worth Rs. 67,49,568/-, and the only outstanding amount
at the end of that financial year was Rs. 2,61,068/-.
6. Similarly, for the year 2012-13, the defendants stated that they
purchased coal amounting to Rs. 14,93,261/-, but had already paid
an excess amount of Rs. 9,88,439/- over and above the actual price of
coal supplied. Thus, for the two financial years 2011-12 and 2012-13,
the plaintiff had allegedly received an excess amount of Rs. 7,46,133/-,
for which no coal was supplied. The defendants further pleaded that the
plaintiff failed to adjust several payments made by their drivers,
including Rs. 2,02,000/- for the year 2011-12 and Rs. 6,70,000/- for the
year 2012-13, as well as Rs. 4,81,500/- for 2011-12 and Rs. 97,000/- for
2012-13. The defendants annexed the details of these transactions
as Schedule-1 and Schedule-2 with their written statement, claiming
that the amounts were not properly accounted for by the plaintiff. They
also referred to Schedule-3 (from the plaint) showing amounts
deposited through their drivers, and Schedules 4 and 5 of their written
statement detailing the actual transactions between the parties.
7. The defendants specifically denied that entry No. 33 of Schedule
3, dated 06.05.2012, reflected a genuine transaction, asserting that no
coal was supplied on that day. Similarly, they denied the coal deliveries
recorded in entry Nos. 23, 24, 25 of Schedule-4(1) and entry Nos. 17 to
24 of Schedule-4(2) of the plaint. They also denied that they purchased
coal worth Rs. 78,35,046/- in 2011-12, or that they paid only Rs.
58,05,000/-, with an outstanding of Rs. 20,30,046/-. The defendants
contended that since the business was ongoing, Rs. 2,61,068/- alleged
outstanding amount for 2011-12 was not a true liability, and after
adjustments for payments made in 2012-13, the plaintiff had received
an excess amount of Rs. 7,46,137/-, which the defendants are entitled
to recover.
8. Further, the defendants denied that they purchased coal worth Rs.
15,29,855/- on credit in 2012-13. Instead, they pleaded that the actual
purchase was Rs. 14,93,261/- and that they had paid Rs.
17,14,700/-, Rs. 6,70,000/-, and Rs. 97,000/-, which already exceeded
the price of coal supplied. They pleaded that no outstanding amount
exists in their favour; rather, the excess payments made by them are
recoverable from the plaintiff. Consequently, the defendants filed
a counterclaim for the recovery of the said excess amount. The
defendants further pleaded that the plaintiff failed to adjust an amount of
Rs. 8,72,000/-, which is reflected in Schedule-6 annexed with the plaint.
This amount corresponds to the details shown in Schedule-2 of the
defendants' written statement, along with the vouchers annexed thereto,
and should have been accounted for in the plaintiff's records.
9. The defendants have also filed a counterclaim for recovery of Rs.
7,46,133/-, with the pleading that in the financial year 2011-12, the
outstanding amount was Rs. 2,61,068/-. In the following year, 2012-13,
the defendants purchased coal amounting to Rs. 14,93,261/-, but
had excessively paid Rs. 9,88,439/-. After adjusting the accounts, the
defendants assert that an excess payment of Rs. 7,46,133/- was made
to the plaintiff, for which they filed their counterclaim seeking recovery of
the same.
10. The plaintiff filed the written statement in reply to the defendants'
counterclaim, reiterating the pleadings and transaction details stated in
his original plaint. He maintained the liability of the defendants as
claimed in the suit and denied the allegations and claims made in the
counterclaim. The plaintiff prayed for dismissal of the defendants'
counterclaim.
11. Based on the pleading of the parties, the learned trial Court has
framed the following issues:-
Sr. No. Issues Result
1. Whether the defendants have purchased Not Proved
3293.27 metric ton coal from the plaintiff on
credit basis?
2. Whether the plaintiff is entitled to get coal's Not Proved
credit amount of Rs. 18,45,201/- from the
defendants?
3. Whether for purchasing of coal the Not Proved
defendants have given Rs. 7,46,133/- in
excess to the plaintiff ?
4. Relief (help and litigation expenses) ? In Para No. 24
12. In support of his case, the plaintiff Kalyan Das Lalwani examined
himself as PW/1 and relied upon the documents of legal notice dated
11.09.2012 (Ex-P/1), reply of the legal notice dated 22.09.2012
(Ex-P/2), details of the coal lifted from Laxman colliery and Manikpur
colliery (Ex-P/3), details of coal lifting statement from Gevra project (Ex-
P/4), copy of debit information (Ex-P/5), copy of the vouchers (Ex-P/6 to
P/67), audit report of the plaintiff's firm (Ex-P/68 and P/69), copy of the
ledger account of the plaintiff's firm (Ex-P/70, and 71), copy of the letter
dated 13.06.2016 issued by the commercial tax officer, Bilaspur, Circle-
2 (Ex-P/72), the letter issued by the Commercial Tax Department (Ex-
P/73, 74 and 75), the letter written to the Commercial Tax Department
by the plaintiff (Ex-P/76 and P/77).
13. The defendants have examined Jagweer Singh (DW/1), Ram
Kripal (DW/2), Mahendra Kumar Nirmalkar (DW/3), Nilkanth Sahu
(DW/4), and relied upon the counter slip of bank deposit receipt (Ex. D/1
to D/3), copy of registration certification of the firm Cheema Bricks (Ex-
D/4c and D/5c).
14. After conclusion of the trial and hearing the parties, the learned
trial Court passed its judgment and decree on 23.08.2017 and
dismissed the suit of the plaintiff as well as the counter claim of the
defandants holding that the parties could not prove their claim by
producing sufficient evidence with respect to their transaction and
payment made by them. The said judgment and decree are under
challenge in the present appeal by the plaintiff.
15. The appellant/ plaintiff in person would submit that the learned trial
Court has failed to appreciate the evidence produced by the plaintiff
with respect to their transaction. The vouchers and bank transactions
have not been properly appreciated by the learned trial Court. The
transaction between the parties and their business relationship has not
been denied by the defendants, but there is only a dispute regarding the
settlement of the account. He would further submit that the defendants
have admitted that there was an outstanding amount of Rs. 261068/- in
the year 2011-12, but they excessively paid Rs. 988439/- in the year
2012-13, and they have not furnished any document that they have paid
the said excess amount to the plaintiff. Once they admitted the
transaction between the parties and the plaintiff proved the transaction
of supply of coal to them by delivery voucher as well as delivery orders
issued by the SECL, the burden shifts upon the defendants to prove the
payment of the price of coal supplied to them. The coal was being
transported through the trucks, and their truck numbers were duly
mentioned in the delivery order issued by the SECL at the time of lifting
the coal from there. A false claim has been raised by the defendants in
their counterclaim, and once their counterclaim has been dismissed and
the defendants have not challenged the dismissal of their counterclaim,
the same attains its finality, and it strengthens the claim raised by the
plaintiff. He would also submit that the plaintiff has given the details of
every transaction made between him and the defendants and proved
his case for recovery of the claimed amount. He would further submit
that from the audit report, submitted by the plaintiff, it has also been
proved that there was an outstanding amount of Rs. 1845201/- for
which the plaintiff is entitled to recover from the defendants. The learned
trial Court has erred in disbelieving the documents filed by the plaintiff
on the ground that the documents are the plaintiff's own record,
therefore, the impugned judgment and decree suffer from perversity and
illegality and the same is liable to be set aside and a decree for
recovery of an amount of Rs. 2118500/- along with the interest be
passed in his favour.
16. On the other hand, learned Senior Advocate appearing for the
respondent opposes the submission made by the plaintiff and submits
that the impugned judgment and decree passed by the learned trial
Court dismissing the suit of the plaintiff is justified, which is based on
proper appreciation of evidence. It is the plaintiff's burden to prove that
the outstanding amount against the defendants came from their
business transaction; however, the plaintiff could not demonstrate the
proper account of the supply of coal to the defendants and the amount
paid by them to him. The bills and vouchers are self-served statements
made by the plaintiff which cannot be relied upon. He would also submit
that the audit report has been prepared by the Chartered Accountant on
the instance of the plaintiff, but the same has not been submitted along
with the income tax return to the income tax department to make it a
genuine report. To prove the audit report, its author has not been
examined, so that the genuineness of the said audit report can be
examined. The plaintiff could not be able to prove the actual quantity of
coal supplied by him to the defendants, though certain Schedules have
been provided by him with respect to the lifting of the coal; however, the
coal so lifted had actually been supplied to the defendants have not
been proved.
17. Learned counsel for the respondents would further submit that the
entire claim of the appellant/plaintiff is based on the self-prepared
schedules, ledger extracts and credit memos (Ex. P/3 to Ex. P/70),
which are stated to have been prepared from the plaintiff's own books of
account. Even assuming such entries were maintained in the course of
business, the same cannot by themselves fasten liability upon the
defendants in view of the provision of Section 34 of the Indian Evidence
Act, 1872, which provides that although entries in books of account
regularly kept in the course of business are relevant, such entries alone
shall not be sufficient to charge any person with liability. Learned
counsel submits that the plaintiff admittedly failed to produce the original
cash books, ledgers, delivery orders, transport documents, or
acknowledged invoices to corroborate the alleged transactions, and
therefore the schedules and statements relied upon by him remain
unverified and self-serving. It is further submitted that the settled legal
position is that entries in books of account require independent
corroboration before liability can be fastened upon the opposite party. In
support of his submissions, he would rely upon the judgment of the
Hon'ble Supreme Court reported in 1998 (3) SCC 410 (Central Bureau
of Investigation vs. V.C. Shukla and Others). Therefore, in the
absence of any independent documentary proof of delivery of coal or
acknowledgement of liability by the defendants, the plaintiff has failed to
discharge the burden cast upon him, and the learned trial Court has
rightly dismissed the plaintiff's suit. Therefore, there is no merit in the
appeal, and the same is liable to be dismissed.
18. At this juncture, he would fairly submit that, in view of the
dismissal of his counterclaim, the defendants also filed their appeal
before this Court bearing F.A. No. 177/2018 (Firm Cheema Bricks
through its Partners Shri Jagveer Singh v. Lalwani and Sons), which
was dismissed on technical grounds of non-compliance with the pre-
emptory order of failure to remove default within the stipulated time, and
the defendants could not restore the same. The said pre-emptory order
was passed on 08-09-2025, and the F.A. No. 177/2018 is treated as
dismissed for default.
19. We have heard the appellant in 'person' and learned Senior
Advocate appearing for the defendants, and gone through the record of
the learned trial court with utmost circumspection.
20. The points for consideration in the present appeal would be
whether the plaintiff has proved the outstanding amount against the
defendants with respect to his claim by producing sufficient
documentary evidence.
21. PW-1 Kalyan Das Lalwani, the plaintiff, deposed that he had
business transactions with the defendants for the supply of coal and
that a sum of Rs. 18,45,201/- remained outstanding against them. In his
examination-in-chief, he reiterated the averments made in the plaint and
claimed recovery of about Rs. 21,18,500/- from the defendants.
However, in his cross-examination, he admitted that he had not filed
any document to establish that he was the proprietor of the firm Lalwani
and Sons. He further admitted that Schedules 1 to 6, including the
seven sub-schedules under Schedule-4, were prepared by him in
computerized format on the basis of the entries in his account books.
He further admitted that he had not produced the original records from
which the said schedules were prepared. The schedules were copied
from a register maintained by him, but he had not filed the original
register, cash book or ledger before the Court. He also admitted in
paragraph 20 of his cross-examination that he had not filed any audit
report relating to the transactions mentioned in the schedules, though
such report ordinarily contains complete details of the financial
transactions for the relevant year. He further admitted that the firm
Lalwani and Sons is an income-tax assessee, yet he had not filed
the income-tax returns for the financial years 2011-12 and 2012-
13 before the Court.
22. In paragraph 21 of his cross-examination, he admitted that he had
not filed any bills, vouchers or cash memos in respect of the supply of
coal mentioned in Schedules 1 to 6, although the entries in those
schedules were stated to be based on such cash memos. He further
admitted that there was no reason for the non-filing of these documents,
though he stated that the same could be produced if directed by the
Court. He also stated that he could not clearly state the exact dates of
supply, the parties to whom the coal was supplied, or the rate at which
the coal was supplied. According to him, the total value of coal supplied
was approximately Rs. 93,00,000/-, out of which he had received
about Rs. 70-75 lakhs, leaving an outstanding amount of about Rs.
18,00,000/-.
23. He further admitted that the rate of coal supplied was not
mentioned in Schedule-1. Although he initially stated that the coal was
supplied at different rates and that the rates were mentioned in the
schedule, he subsequently admitted that Schedule-1 does not specify
any different rates of coal. He also stated that he could not recall the
exact rates at which the coal had been supplied. He stated that the
relevant credit memos relating to the transactions could be produced
before the Court if so directed.
24. In further cross-examination, the plaintiff/P.W. 1 admitted that
in Schedule-3 annexed with the plaint, the details of trucks were not
mentioned in entry numbers 15, 16, 22 and 33. He also admitted that he
had not filed any acknowledgment or receipt from Cheema
Bricks regarding the alleged supply of coal and that the transactions
were claimed to have been made in good faith in the normal course of
business. He further admitted that the drivers of the trucks mentioned
in Schedules 3 and 4 were not drivers of Cheema Bricks. Although he
voluntarily stated that those trucks had been engaged for transportation
to Cheema Bricks, he admitted that no document had been produced to
show that the said trucks belonged to Cheema Bricks or that the
defendant firm had authorized them. He also admitted that no
documentary evidence had been filed to substantiate the alleged supply
of 500 MT and 393.270 MT of coal mentioned in Schedules 3 and 4.
25. He further admitted that he had not filed any Delivery Order
(DO) in the present case. He stated that the DO is usually submitted in
the colliery and that he had filed documents relating to the colliery. He
also admitted that the trucks mentioned in Serial Nos. 17 to 24 of
Schedule-4(2) did not belong to Cheema Bricks. He further admitted
that in respect of the alleged supply of 123.370 MT of coal mentioned in
Schedule-4(2), the schedule does not disclose which trucks carried the
coal, on what date it was supplied, or to whom it was delivered. He also
admitted that there was no document to show whether those trucks
belonged to Cheema Bricks or were authorized by the defendant firm.
He further admitted that several trucks mentioned in Serial Nos. 1 to 23
of Schedule-4(6) and Serial Nos. 5, 6, 12 and 28 of Schedule-4(7) did
not belong to Cheema Bricks, and there was no document on record to
show that the defendant firm had authorized those trucks. He further
admitted in paragraph 34 of his evidence that he had received certain
payments from Cheema Bricks through RTGS, and that the amount
reflected in Ex. D-1 to D-3 worth Rs. 10,70,000/- had not been disclosed
in the plaint.
26. On 12-01-2017, the plaintiff was re-examined, and he marked Ex.
P-6 to P-70 on the documents produced by him, which included credit
memos relating to coal transactions, ledger accounts and the audit
report. The defendants raised objections to the exhibition of these
documents, and the Court kept the objections pending to be decided at
the time of final disposal of the case. In further cross-examination, the
plaintiff stated that during the financial years 2011-12 and 2012-13,
except for transactions with Cheema Bricks, he had not made any
transactions with other parties within the State, though he stated that he
had some transactions outside Chhattisgarh, the details of which he
could not explain.
27. He further admitted that all the credit memos bearing Serial Nos.
01 to 61 appeared to have been prepared in the same ink and with the
same ball pen, and the handwriting on them was also similar. He also
admitted that he had not filed the duplicate slips relating to the lifting of
coal. He further admitted that documents Ex. P-73 and Ex. P-74 did not
bear the seal or signature of Cheema Bricks, and the bills Ex. P-76 and
Ex. P-77 did not contain the TIN number, Sales Tax number or
registration number of the firm, nor did they contain any
acknowledgment of Cheema Bricks. He also admitted that the audit
report did not bear his signature and that it had been prepared by
his C.A., and he acknowledged the endorsement made in Column B-1
of Annexure-I of Ex. P-68 and Ex. P-69.
28. The defendant witness (DW-1 Jagbeer Singh), who is a partner of
M/s Cheema Bricks, stated that he looks after the entire business and
accounts of the firm. He deposed that the firm had business dealings
with the plaintiff firm, Lalwani & Sons, for the purchase of coal on the
basis of an oral agreement. According to him, coal was supplied by the
plaintiff as per demand and payments were made from time to time
through bank deposits as well as through truck drivers. He stated that
during the financial year 2011-12, coal worth Rs. 67,49,568/- was
supplied, out of which only Rs. 2,61,068/- remained at that time, and
during 2012-13, coal worth Rs. 14,93,261/- was received, against which
substantial payments were already made. He further stated that
payments including Rs. 2,02,000/- through IDBI Bank and other
amounts of Rs. 1,70,000/- and Rs. 5,00,000/- were deposited in the
plaintiff's account, and receipts of these payments were produced
before the Court.
29. He further deposed that the plaintiff has made incorrect entries in
his own ledger and incorrect schedules annexed with the plaint, and has
not adjusted several payments received through bank transactions and
through drivers. He denied receiving certain quantities of coal
mentioned in the plaintiff's schedules and stated that many cash memos
do not contain proper truck numbers or weight details. According to the
defendant's calculation, after adjusting all transactions for the financial
years 2011-12 and 2012-13, no amount is payable to the plaintiff and
rather an excess amount of Rs. 7,46,133/- has been paid by the
defendant firm to the plaintiff. In cross-examination, the witness
admitted that the plaintiff had earlier issued a legal notice demanding
Rs. 18,45,201/-, to which he replied through his advocate, but stated
that at that time the complete and final accounts had not yet been
calculated.
30. It is well-settled that in a recovery suit the burden lies on the
plaintiff to establish his case by credible evidence, and not by mere
assertions or self-serving documentary statements. Under Section 101
of the Indian Evidence Act, 1872, the burden of proof is on the person
who substantially asserts the affirmative of the issue; in a suit for
recovery of money, the plaintiff must prove that the debt is due and
payable and the amount claimed is correctly computed. The plaintiff in
this case has relied upon computerized schedules and self-prepared
statements (Ex-P/1 to Ex-P/77), none of which were supported by
original books of account, delivery orders, or validated invoices. In
cross-examination, the plaintiff admitted that he had not produced
original cash books, ledgers or delivery orders and could not even
specify the precise dates of supply or the rate at which goods were sold,
rendering the evidence unsatisfactory and insufficient to discharge his
burden of proof as mandated by Section 101 of the Evidence Act.
31. The Hon'ble Supreme Court has repeatedly held that the quality of
evidence, and not merely quantity, is critical in civil disputes; documents
must inspire confidence and be capable of verification from independent
sources. In this case, the plaintiff's evidence comprised schedules,
prepared from his own account books without the production of original
records, credit memos, bills or cash memos accompanied by delivery
receipts. The plaintiff's audit report was neither filed before the
income-tax department nor supported by the testimony of the Chartered
Accountant who prepared it. The non-production of delivery orders and
original transport documents further weakens the plaintiff's case, as
such documents are integral to proving the physical supply of goods in
transactions.
32. It is necessary here to notice Section 34 of the Indian Evidence
Act, 1872 (Section 28 of Bhartiya Sakshya Adhiniyam, 2023), which is
as follows:-
34. Entries in books of account , including those
maintained in an electronic form], regularly kept in the
course of business, are relevant whenever they refer to a
matter into which the Court has to inquire, but such statements
shall not alone be sufficient evidence to charge any person
with liability.
33. In the case of Central Bureau of Investigation Vs. V.C. Shukla
and Ors, reported in (1998) 3 SCC 410, in para 35 to 37, the Hon'ble
Supreme Court has held that:-
35. The probative value of the liability created by an entry in
books of account came up for consideration in Chandradhar
Goswami v. Gauhati Bank Ltd. That case arose out of a suit
filed by Gauhati Bank against Chandradhar (the appellant
therein) for recovery of a loan of Rs 40,000. In defence he
contended, inter alia, that no loan was taken. To substantiate
their claim the Bank solely relied upon certified copy of the
accounts maintained by them under Section 4 of the Bankers'
Book Evidence Act, 1891 and contended that certified copies
became prima facie evidence of the existence of the original
entries in the accounts and were admissible to prove the
payment of loan given. The suit was decreed by the trial court
and the appeal preferred against it was dismissed by the High
Court. In setting aside the decree this Court observed that in
the face of the positive case made out by Chandradhar that
he did not ever borrow any sum from the Bank, the Bank had
to prove the fact of such payment and could not rely on mere
entries in the books of account even if they were regularly
kept in the course of business in view of the clear language of
Section 34 of the Act. This Court further observed that where
the entries were not admitted it was the duty of the Bank, if it
relied on such entries to charge any person with liability, to
produce evidence in support of the entries to show that the
money was advanced as indicated therein and thereafter the
entries would be of use as corroborative evidence.
36. The same question came up for consideration before
different High Courts on a number of occasions but to eschew
prolixity we would confine our attention to some of the
judgments on which Mr Sibal relied. In M.S. yesuvadiyan v.
P.S.A. Subba Naicker one of the learned Judges contituting
the Bench had this to say:
"Section 34. Evidence Act, lays down that the entries
in books of account, regularly kept in the course of
business are relevant, but such a statement will not
alone be sufficient to charge any person with liability.
That merely means that the plaintiff cannot obtain a
decree by merely proving the existence of certain
entries in his books of account even though those
books are shown to be kept in the regular course of
business. He will have to show further by some
independent evidence entries represent real and
honest transactions and that the moneys were paid
in accordance with those entries. The legislature
however does not require any particular form or kind
of evidence in addition to entries in books of account,
and I take it that any relevant facts which can be
treated as evidence within the meaning of the
Evidence Act would be sufficient corroboration of the
evidence would be furnished by entries in books of
account if true."
While concurring with the above observations the other
learned Judge stated as under:
"If no other evidence besides the accounts were
given, however strongly those accounts may be
supported by the probabilities, and however strong
may be the evidence as to the honesty of those who
kept them, such consideration could not alone with
reference to Section 34, Evidence Act, be the basis
of a decree."
(emphasis supplied)
37. In Beni v. Bisan Dayal it was observed that entries in
books of account are not by themselves sufficient to charge
any person with liability, the reason being that a man cannot
be allowed to make evidence for himself by what he chooses
to write in his own books behind the back of the parties. There
must be independent evidence of the transaction to which the
entries relate and in absence of such evidence no relief can
be given to the party who relies upon such entries to support
his claim against another. In Hira Lal v. Ram Rakha the High
Court, while negativing a contention that it having been
proved that the books of account were regularly kept in the
ordinary course of business and that, therefore, all entries
therein should be considered to be relevant and to have been
proved, said that the rule as laid down in Section 34 of the Act
that entries in the books of account regularly kept in the
course of business are relevant whenever they refer to a
matter in which the Court has to enquire was subject to the
salient proviso that such entries shall not alone be sufficient
evidence to charge any person with 9 liability. It is not,
therefore, enough merely to prove that the books have been
regularly kept in the course of business and the entries
therein are correct. It is further incumbent upon the person
relying upon those entries to prove that they were in
accordance with facts.
34. Further, in the case of "Ishwar Dass Jain (dead) Through LRS.
v. Sohan Lal (dead) by LRS.", 2000 (1) SCC 434, the Hon'ble
Supreme Court held that:-
23. Now under Section 34 of the Evidence Act, entries in
"account books" regularly kept in the course of business
are admissible though they by themselves cannot create
any liability. Section 34 reads as follows:
"34. Entries in books of account when relevant-
Entries in books of account, regularly kept in the
course of business, are relevant whenever they
refer to a matter into which the court has to inquire,
but such statements shall not alone be sufficient
evidence to charge any person with liability."
It will be noticed that sanctity is attached in the law of
evidence to books of account if the books are indeed
"account books" i.e. in original and if they show, on their
face, that they are kept in the "regular course of business".
Such sanctity, in our opinion, cannot attach to private
extracts of alleged account books where the original
accounts are not filed into court. This is because, from the
extracts, it cannot be discovered whether the accounts are
kept in the regular course of business or if there are any
interpolations or whether the interpolations are in a
different ink or whether the accounts are in the form of a
book with continuous page-numbering. Hence, if the
original books have not been produced, it is not possible to
know whether the entries relating to payment of rent are
entries made in the regular course of business.
25. In the recent judgment of this Court in Central Bureau
of Investigation v. V.C. Shukla it has been laid down that
for purposes of Section 34, "book" ordinarily means a
collection of sheets of paper or other material, blank,
written or printed, fastened or bound together so as to form
a material whole. Loose sheets of paper or scraps of paper
cannot be termed as "book" for they can be easily
detached and replaced. It has also been held that: (SCC p.
432, para 34)
"The rationale behind admissibility of parties' books
of account as evidence is that the regularity of
habit, the difficulty of falsification and the fair
certainty of ultimate detection give them in a
sufficient degree a probability of trustworthiness."
When that is the legal position, extracts of alleged account
books, in our view, were wrongly treated as admissible by
the courts below though the original books were not
produced for comparison nor was their non-production
explained and nor was the person who had prepared the
extracts examined.
35. In the aforesaid judgments, the Hon'ble Supreme Court
emphasized that books of account constitute only corroborative
evidence and cannot by themselves prove the liability of another person
unless supported by reliable and independent material. Applying the
aforesaid principle to the facts of the present case, the schedules,
ledger statements and credit memos relied upon by the plaintiff, being
prepared from his own records and not supported by original books of
account, delivery orders, transport documents or acknowledged
invoices, cannot by themselves establish the alleged outstanding
liability of the defendants. Consequently, the plaintiff has failed to
discharge the burden cast upon him to prove the claim by cogent and
reliable evidence.
36. The defendants, conversely, have produced bank deposit
receipts (Ex-D/1 to Ex-D/3) and oral testimony establishing payments
made by them, several of which were not adjusted by the plaintiff in his
accounts. The defendants also identified specific entries in the plaintiff's
schedules that were incorrect, unsupported by truck authorizations or
weight details, and in certain instances denied outright. Here, the
cumulative evidence presented by the plaintiff fails to meet this
standard, while the evidence adduced by the defendants reasonably
demonstrates that there was a substantial payment and that the plaintiff
incorrectly reflected the accounts. On the preponderance of
probabilities, the defendants' evidence stands on a better footing than
the plaintiff's self-generated schedules. The Courts have consistently
held that in civil matters the standard of proof is "preponderance of
probability", not beyond a reasonable doubt.
37. In the case of "Iqbal Singh Marwah v. Meenakshi Marwah",
2005 (4) SCC 370, the Hon'ble Supreme Court has held that :-
"32. Coming to the contention that an effort should be
made to avoid conflict of findings between the civil and
criminal courts, it is necessary to point out that the
standard of proof required in the two proceedings are
entirely different. Civil cases are decided on the basis of
preponderance of evidence while in a criminal case the
entire burden lies on the prosecution and proof beyond
reasonable doubt has to be given............."
38. The plaintiff filed the present suit claiming recovery of Rs.
21,18,500/- on the basis of the alleged supply of 3293.27 MT (2793.27
+ 500 = 3293.27) of coal to the defendants during 2011-12 and 2012-
13. The plaintiff relied primarily on self-prepared schedules, annexures,
and credit memos (Ex.P-3 to Ex.P-67), along with correspondence from
SECL (Ex.P-3 and Ex.P-4), to establish the supply and outstanding
dues. However, the trial court noted that these documents did not
conclusively demonstrate delivery of coal to the defendants, as
discrepancies existed in the delivery order numbers and original
registers, cash books, and delivery receipts were not produced. Certain
credit memos bore the defendant's registration number even before the
firm was officially registered, and the continuity of bills was inconsistent
with other transactions undertaken by the plaintiff outside Chhattisgarh.
The plaintiff also admitted in cross-examination that he had not filed
corroborative evidence such as income-tax returns, further undermining
the reliability of his evidence. On this basis, the trial court rightly held
that the plaintiff's documents were insufficient to establish the quantity
of coal supplied or the amounts due.
39. The learned trial court correctly applied the principle of
preponderance of probability, under Section 101 of the Indian Evidence
Act, 1872, and held that the plaintiff had failed to discharge his burden
of proof. The court also emphasized that self-serving statements or
schedules, without independent verification, cannot form the basis for a
civil claim. Considering the totality of evidence and the deficiencies in
the plaintiff's evidence, the dismissal of the plaintiff's claim is justified
and reasoned exercise of discretion, in accordance with settled
principles of law.
40. Consequently, the appeal filed by the plaintiff is liable to be and is
hereby dismissed.
41. Parties to bear their own costs.
42. An appellate decree be drawn accordingly.
Sd/- Sd/-
(Ravindra Kumar Agrawal) (Ramesh Sinha)
Judge Chief Justice
sagrika
Head Note
The account book is a private and unilateral record maintained by one
party and such record cannot be treated as substantive evidence under
Section 34 of the Indian Evidence Act, 1872, to impose liability for
enforcement of a legal right without independent and corroborative
evidence.
