Shri Love Kumar Sethi vs Deluxe Stores And Ors.
2007 Latest Caselaw 2112 Del

JUDGMENT

Manmohan Sarin, J.

1. Appellant Shri Love Kumar Sethi has preferred this appeal against the judgment dated 1st March, 2005 passed by the Addl. District Judge, dismissing his suit No. 80/2002 filed by the appellant recovery of Rs.4,64,400/-(Four Lac sixty four thousand four hundred only). Parties were left to bear their own costs. The present appeal was preferred on 7th October, 2005. After counting time taken in obtaining certified copy, there is a delay of nearly 146 days in institution of the appeal. Appellant has accordingly moved CM 15787/2005 being an application under Section 5 of the Limitation Act for condensation of delay in filing of the appeal. Reply to the said application has been filed. We shall advert later to this aspect.

2. The facts in brief culminating in filing of the present appeal may be noted:

(i) Appellant Love Kumar Sethi filed a suit under Order xxxvII CPC for recovery of Rs.4,64,400/- together with pendente lite and future interest. Appellant claims to have deposited with the respondents a sum of Rs.15,000/- per month commencing from 7th February, 2000 till 7th January, 2002 resulting in total deposit of Rs.3,60,000/-. The suit amount of Rs.4,64,000/- is inclusive of interest @ 24% from 7th February, 2000 till 7 January, 2002. The respondents executed promissory notes for the sum of Rs.15,000/- deposited each month carrying interest @ 24% for a period of two years. Respondents failed to make repayment of the amount mentioned in the promissory notes executed by the respondents in favor of the appellant from 7th February, 2000 to 7th January, 2002.

(ii) Appellant accordingly served a legal notice demanding payment in respect of all the promissory notes executed by the respondents in favor of the appellant from 7th February, 2000 to 7th January, 2002 together with interest @ 24% amounting to Rs.4,64,000/-. Despite notice dated 9th April, 2002, respondents failed and neglected to make the payment. Leave to contest the suit was granted to the respondents and written statement was filed. Respondents in the written statement raised a number of preliminary objections claiming the suit to be premature since no cause of action had yet accrued to the appellant for instituting the suit. It was claimed by the respondents that promissory notes had been executed by respondents 2 & 3 in the year 1993-1994 and were handed over to one Mr.Vijay Kumar Bhardwaj. The present suit was barred by limitation. It was the respondent's case that money had been advanced by one Vijay Kumar Bhardwaj, a high police functionary, who had obtained the signed promissory notes and promised to return the same but failed to do so.

(iii) It was claimed that promissory notes had not been executed on behalf of respondent No. 1-firm but had been signed by respondents 2 & 3 in their individual capacity. It was claimed that as the financial condition of the respondent did not improve, Mr.Bhardwaj suggested respondents 2 & 3 to transfer first and second floor of shop No. 41, defense Colony Market to him and his nominees. For this purpose, Sale deeds in respect of first and second floors of the shop were made in name of his brother Mr.Ajay Kumar Bhardwaj and his brother in law Mr.Pramod Kumar respectively and the entire loan given by Vijay Kumar Bhardwaj stood adjusted against the said transactions. However, Vijay Kumar Bhardwaj deceitfully and maliciously did not return the promissory notes by making false excuses that same were not traceable.

3. Learned Counsel, therefore, submits that substantial justice has been done in the matter to the respondents by the finding of the trial court that the said promissory notes not being inadmissible in evidence inasmuch as respondents had more than discharged their liability by transferring of first and second floor of the shop in question and were being made to suffer double jeopardy on being sued on promissory notes that had not been deceitfully returned.

4. For the purposes of deciding this appeal, it is not necessary for us to go into the question of appreciation of evidence and the factual aspects of the pleas raised in defense. This is because the learned Addl. District Judge has accepted the preliminary objection raised by the respondents regarding inadmissibility of the promissory notes in question. Consequently the suit being based on the promissory notes, would not be maintainable. The learned Addl. District Judge also held that receipts Ex PW1/28 to Ex.PW 1/32 could also not be segregated from the promissory note. Besides the receipts were without revenue stamps. Accordingly, the court dismissed the suit.

5. The second objection to the appeal is delay of 146 days in its institution. It is the respondents' case that appellant, far from showing any sufficient or tenable cause for condensation of delay has not been able to even explain the delay.

6. Having noted the relevant facts to the extent that were necessary for appreciating the controversy in appeal regarding the admissibility of promissory notes, let us consider the objection of the respondents and the appellant's plea urged by the respondents against its acceptance. The preliminary objection is reproduced for facility of reference:

All the promissory notes are not admissible in evidence. Each Promissory note is payable "otherwise than on demand". This being so, the alleged Promissory Notes are not duly stamped as required vide Entry No. 49 read with Entry 13 of Schedule Stamp Act and in view of Section 35 of the Stamp Act, the said promissory notes are not admissible in evidence.

7. The learned Trial Judge has duly analyzed the contents of the promissory notes. He found that pronotes Exhibit PW 1/1 to Exhibit PW 1/24 have the same language. The only difference being that of the date of the execution and the date on which payment was to be made. Exhibit PW 1/6 and PW 1/9 bear the name of respondent No. 3 i.e Shri Chitter Mal Jain while in all the other pronotes name of respondent No. 2 i.e Shri Rakesh Jain was mentioned.

8. The promissory notes were payable after two years from the date of execution. The promissory notes also carried the seal of M/s Deluxe Stores i.e respondent No. 1. Section 35 of the Indian Stamp Act, 1899 contains an embargo on admissibility of any instrument, without the same being duly stamped. Exception to the same are instruments chargeable with a duty not exceeding ten paise on a bill of exchange or promissory note. In other words insufficiency of stamps cannot be made up in case of bill of exchange or promissory notes. Requisite stamp duty for a promissory note which is payable otherwise than on demand i.e after a specified period is covered under Article 49 of Schedule I of the Act. It is exigible to the same duty as on a "Bill of Exchange" for the same amount payable otherwise than on demand.

In the instant case, it is the admitted position of the parties that promissory notes which are payable otherwise then on demand do not carry the adequate stamps, as required. The Trial Judge has correctly held the said promissory notes to be inadmissible in evidence.

9. Learned Counsel for the appellant sought to urge before us that there has been an amendment in Section 35 of the Indian Stamp Act in the year 2006, which would enable even a promissory note insufficiently stamped to be admissible in evidence on payment of deficient duty together with penalty. It is not the case of the appellant that amendment is with retrospective effect. The amendment to the statute is with prospective effect and it does not cover the present suit in which the judgment dated 1.3.2005 is impugned. As the same cannot be held to be with retrospective effect, we are, therefore, in agreement with the findings of the learned Trial Judge that promissory notes and the receipts are integral documents and cannot be segregated besides reading of the plaint that suit is based on the promissory notes. In fact the averments in the plaint do not even mention execution of the receipts.

10. Let us now consider the appellant's case for condensation of delay. The judgment and decree were passed on 1st March, 2005 while the present appeal was preferred on 7th October, 2005. The appellant applied for the certified copy without much loss of time and the same was made available on 5th March, 2005. It is stated that from the month of March, 2005, talks for compromise were going on between the respondents and the respondents had approached them for getting the matter compromised along with two other similar matters filed against respondents which were being contested by the same counsel. It is averred that appellant was even willing to accept the principal amount with legal costs i.e. court fees as part of the compromise. Further the feasibility of the compromise appeared to be bright inasmuch as respondents had lost another suit in the trial court which was being contested by the same counsel as the counsel for the appellant. The appellant believing that there would be a settlement did not instruct his counsel to file an appeal. It was urged that Respondents delayed the compromise talks. Appellant further claims that from 25th July, 2005 to 10th August, 2005, appellant was ill. It was only on 18th August, 2005 that appellant after fully recovering and finding that respondents had declined to settle any of the matters, instructed his counsel to draft an appeal and file the same. It is then claimed that file got misplaced in the office of the counsel and the same could be traced only on 25th September, 2005 and appeal was then filed on 7th October, 2005 entailing a delay of 146 days in filing of the appeal. Respondents have filed a reply denying any talks of compromise. The entire story is said to be a concocted one and appellant has grossly neglected in pursuing its remedies. Appellant has slept over his remedies. It is stated that appellant himself has given the real reason for the delay in filing the appeal which is as under:

failure to instruct his counsel towards filing of the appeal.

There is no record produced regarding appellant suffering from viral fever. Similarly the story that file being misplaced does not deserve any credence. File even after being traced on 25th September, 2005, as per appellant's own version, present appeal was filed on 7th October, 2005 and there is no explanation for the delay. No specific details or particulars regarding alleged talks for compromise are mentioned. While it is true that each day of the delay need not to be explained by the appellant and the courts generally adopt a liberal approach pitted in favor of grant of substantial justice yet the law of limitation cannot be given a complete go by. Appellant has to satisfy the court regarding there being sufficient cause and the facts must inspire confidence. In the present case, there is a delay of nearly 146 days which the appellant has failed to explain. There is neither any particular details with regard to the compromise talks between the persons nor the dates or places are mentioned. The entire span of 146 days is sought to be explained by different species, reasons and causes which do not inspire confidence. There is nothing to support the contention regarding misplacement of the file or any affidavit of the counsel showing misplacement of the file in his office.

We are, therefore, of the view that appellant has not made out a sufficient cause for the condensation of delay in filing of the appeal. Even otherwise as discussed, no ground is made out for interference in the well reasoned judgment of the trial court.

Appeal is accordingly dismissed.