Kerala High Court
M.M.Rajeev vs O.K.Eldhose on 15 July, 2021
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MRS. JUSTICE MARY JOSEPH
THURSDAY, THE 15TH DAY OF JULY 2021 / 24TH ASHADHA, 1943
RFA NO. 201 OF 2013
AGAINST THE JUDGMENT AND DECREE DATED 10.07.2012 IN
O.S.NO.74/2011 OF SUB COURT, PERUMBAVOOR
APPELLANT/DEFENDANT:
M.M.RAJEEV
S/O MADHAVAN, MULAKKAKUDY HOUSE,
CHERUKUNNAMKARA, ASAMANNOOR VILLAGE
BY ADVS.
SRI.PIRAPPANCODE V.S.SUDHIR
SRI.JELSON J.EDAMPADAM
RESPONDENT/PLAINTIFF:
* 1. O.K.ELDHOSE (DIED)
S/O KURIAKOSE, OOTHALAKODAN HOUSE, VENGOLA
KARA, VENGOLA VILLAGE - 683546
2. C.E.OMANA, W/O LATE O.K ELDOSE, OOTHALAKOTTU
HOUSE, ALLAPRA P.O, VENGOLA KARA, VENGOLA
VILLAGE.
3. AJAI BASIL, S/O DO ELDOSE, DO...DO..
4. ANSE MARY BASIL, D/O DO ELDOSE, DO...DO..
(THE ABOVE LEGAL HEIRS OF THE DECEASED R1 ARE
IMPLEADED AS ADDITIONAL R2 TO 4 AS PER ORDER
DATED 26/11/13 IN IA NO.2215/13.)
BY ADV SMT.P.V.KOCHUTHRESIA
THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD
ON 26.03.2021, THE COURT ON 15.07.2021 DELIVERED THE
FOLLOWING:
R.F.A. No. 201 of 2013
-:2:-
MARY JOSEPH, J.
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R.F.A. No. 201 of 2013
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Dated this the 15th day of July, 2021
JUDGMENT
Judgment passed on 10.07.2012 by Sub Court, Perumbavooor
in O.S. No.74/2011 decreeing a Suit for money based on cheques
is assailed in the appeal on hand by the defendant who has
suffered the decree. The appellants and respondents shall be
referred to hereinafter as the defendant and the plaintiff in
accordance with their status in the suit.
2. Rs.6,00,000/- was borrowed by the defendant from the
plaintiff stating that the loan applied for is pending consideration of
the bank and promising that the borrowed amount with interest
would be repaid immediately on sanctioning the loan in his favour.
3. The repayment was delayed and therefore the plaintiff
approached him demanding the same. He was told by the
defendant that some technical reasons had intervened in the grant
of loan in time and accordingly the period of repayment was sought
to be extended for three more years. Finding no other alternative
R.F.A. No. 201 of 2013
the plaintiff was constrained to agree to extend the time for
repayment to three years. A debt acknowledgment letter was
executed on 25.03.2008 undertaking to repay the amount with
12% interest in six instalments. Title deeds of the defendant
bearing Nos.4514/2007 and 4890/2007 and six cheques drawn
from various accounts maintained by him with different banks were
also drawn and issued to the plaintiff. The cheques were presented
for encashment but were bounced due to want of funds in the
accounts of the defendant.
4. At the time when each cheques were returned bounced,
the factum was timely informed to the defendant through lawyer
notices sent to him and those were also evidenced as received by
him. But, the defendant neither repaid the amount as demanded
nor cared to sent a reply to the notice. Thereupon the plaintiff
was constrained to file the suit as O.S.No.74/2011 for realisation of
six lakhs with interest at the rate of 12% per annum from the date
of institution of the suit till realisation from the defendant and his
assets.
5. The defendant on his appearance in the suit filed written
statement denying the pleadings of the plaintiff in the plaint and
raising contentions of his own. Admittedly a loan of Rs.4,75,000/-
R.F.A. No. 201 of 2013
was availed by him from the plaintiff, and interest at the rate of
60% was paid to the plaintiff till August, 2010. In the month of
April 2010 a sum of Rs.2,00,000/- was given to credit towards the
principal sum borrowed. At the time of availing the loan 6 signed
cheque leaves for double the loan amount availed, two signed
blank stamp papers, 2 signed unwritten white papers, and the
original title deed with the prior deed of the property belongs to the
defendant were also given to the plaintiff as security for the loan
availed. Interest was defaulted after August 2010. Without
crediting the amount paid by him towards principal and interest,
the plaintiff presented the cheque leaves after putting dates
thereon. The plaintiff had also caused the defendant to hand over
a debt acknowledgement letter in a blank signed stamp paper to
him at the relevant time when the loan was availed. The defendant
approached the plaintiff and demanded to credit the amount
already paid by him towards the principal sum and interest and the
plaintiff was amenable for that. The defendant had also agreed to
repay the outstanding dues towards the loan and the interest. The
defendant is ready to pay the actual amount due towards principal
and interest and accordingly seeks to dismiss the suit with costs.
R.F.A. No. 201 of 2013
6. The trial court framed the following issues for
consideration on the basis of the contra pleas raised before it by
the parties to the suit.
"1. Whether the defendant borrowed an amount of Rupees
6 lakhs from the plaintiff during 2006-07?
2. Whether on 25.3.2008 defendant issued a letter of
acknowledgement to plaintiff as contended by plaintiff ?
3. Whether the plaintiff is entitled to realise the amount claimed in
the plaint from the defendant ?
4. Relief and costs ?"
7. Both parties adduced oral as well as documentary
evidence aiming to establish their respective pleadings. Plaintiff
examined himself as PW1 and also examined a witness as PW2.
Exts.A1 to A42 were also marked. Defendant examined himself as
DW1 and marked Exts.B1 to B11. The Trial Court considered the
issues in the light of the evidence adduced by either parties and
answered those in the affirmative in favour of the plaintiff.
Accordingly the suit was decreed as follows :
"Defendant shall pay a sum of Rs.8,28,864/- (Rupees
eight lakhs twenty eight thousand eight hundred and sixty four
only) to plaintiff with interest at 12% per annum from the date
of suit till realisation for the principal sum of Rs.8,00,000/-.
Defendant shall pay cost also."
R.F.A. No. 201 of 2013
8. According to Sri.Pirappancode V.S. Sudheer, the
contentions of the defendant that the cheques had been misused
by the plaintiff and on the strength of falsely created documents,
the plaintiff resorted to file the suit seeking realisation of excess
sum than due, were successfully established by the defendant but
on an erroneous appreciation of the evidence adduced by him the
trial court decreed the suit. According to him, a version highly
inconsistent with that of PW1, was spoken by PW2, but the trial
court had decreed the suit in favour of PW1 solely relying on his
solitary evidence.
9. According to the learned counsel, in view of the distinct
dissimilarity visible to the naked eye itself in the handwriting in
which the date and other entries have been entered into the
cheques, the trial court had decreed the suit. According to him, a
prudent man would not grant three more years time for repayment
of the sum borrowed, that too in six instalments after receiving
six cheques, to a man who was already in default. According to
him, the defendant had borrowed only Rs.4,75,000/- from the
plaintiff and at the relevant time itself six signed undated cheques
had been given as security and since Rs.2,00,000/- and interest till
August 2010 stand repaid, credit of that must be granted and
R.F.A. No. 201 of 2013
therefore trial court would not have accepted the version of PW1 in
that line. The trial court ought to have passed the judgment to the
extent of the balance sum. According to the learned counsel when
execution stands denied by the defendant, the plaintiff ought to
have adduced cogent and reliable evidence to establish it, in
discharge of his burden. According to the learned counsel, cheques
were given without dates being put in it and therefore, putting the
dates in it by the defendant itself tantamount to material
alteration. The learned counsel has also relied on dictums of
various courts to fortify the arguments advanced by him.
10. Smt.Kochuthresia, the learned counsel for the plaintiff
raised arguments supportive of the findings of the trial court.
According to her, the defendant also concede the borrowal of the
money from the plaintiff. But the parties are at variance on the
time when loan was availed, the amount borrowed, the amount
repaid and the time when six cheques were issued. According to
the plaintiff, loan was availed during 2006-2007, but to the
defendant, in the year 2008. According to the plaintiff when the
defendant approached the plaintiff seeking to extend the time for
repayment, six cheques were given but, according to the
defendant, those were given as security at the relevant time when
R.F.A. No. 201 of 2013
money was borrowed. According to the plaintiff, the sum borrowed
is Rs.6,00,000/- but to the defendant, it is only Rs.4,75,000/-.
According to the plaintiff, interest till August 2008 was paid but, to
the defendant Rs.2,00,000/- together with interest for a period
were paid. According to the plaintiff, cheques with all entries filled
were given whereas the defendant has a case that all entries other
than date were filled and given. According to the plaintiff, the debt
acknowledgment letter was genuinely executed and given by the
defendant but to the defendant, the said document was falsely
created by the plaintiff in a blank stamp paper given as security at
the relevant time of availing of loan.
11. Borrowal of the money stands admitted by the
defendant. Issuance of cheques, six in numbers were also
admitted by the defendant. According to him, at the relevant time
of issuance of those all entries except the dates were filled and
given. Therefore, there is no dispute that the cheques were issued
with figures showing the amount, duly filled up.
12. The cheques were marked in evidence by the plaintiff as
Exts.A4, A9, A14, A19, A24 and A29. A perusal of the cheques
would reveal that amounts were written in those respectively as
Rs.2,00,000/-, Rs.2,00,000/-, Rs.1,00,000/-, Rs.1,00,000/-,
R.F.A. No. 201 of 2013
Rs.1,00,000/- and Rs.1,00,000/-. When the filling up of the
cheques with reference to the amount stands undisputed by the
defendant, the claim of the plaintiff in the suit that a total sum of
Rs.8,00,000/- was due at the time when the cheques were issued
and Rs.8,28,864/- (Principal sum of Rs.6,00,000/- and interest at
the rate of Rs.12% per annum) is due to him at the relevant time
of filing of the Suit, stands probabilised.
13. The stand of the defendant was that Rs.4,75,000/- was
borrowed from defendant and the interest charged on the sum
advanced was 60%. According to him interest was paid for a
period and Rs.2,00,000/- was also paid towards the principal sum
borrowed.
14. The admitted case of the defendant was that 6 cheques
for Rs.8,00,000/- in total were given at the time of availing of the
loan itself. What made the defendant to issue six cheques for
Rs.8,00,000/- at the relevant time of availing of the loan amount
itself is not known. No cogent explanation for that is forthcoming
from DW1. Therefore, the stand taken by the defendant in defence
itself is confusing.
15. Yet another important aspect to be noticed is the claim of
the defendant that Rs.2,00,000/- was paid towards the principal
R.F.A. No. 201 of 2013
amount of loan stands unestablished. The defendant failed to
produce a receipt to evidence payment of Rs.2,00,000/- towards
principal sum. A prudent man would obtain a receipt when a
substantial sum is repaid by him towards the loan dues especially
when his specific case was that cheques for Rs.8,00,000/- are
retained by the plaintiff as security.
16. An important aspect arises for consideration is whether
entering the dates in the cheques, duly filled up in all other
respects and also signed would amount to material alteration as
contended by the learned counsel for the defendant.
17. Section 20 of the Negotiable Instruments Act, 1881 is
relevant in the context and is extracted hereunder for convenient
reference:
"20. Inchoate stamped instruments.--Where one person
signs and delivers to another a paper stamped in accordance
with the law relating to negotiable instruments then in force in
India, and either wholly blank or having written thereon an
incomplete negotiable instrument, he thereby gives prima facie
authority to the holder thereof to make or complete, as the
case may be, upon it a negotiable instrument, for any amount
specified therein and not exceeding the amount covered by the
stamp. The person so signing shall be liable upon such
instrument, in the capacity in which he signed the same, to any
holder in due course for such amount:
R.F.A. No. 201 of 2013
Provided that no person other than a holder in due
course shall recover from the person delivering the instrument
anything in excess of the amount intended by him to be paid
thereunder."
18. In the case on hand the handing over of the cheques by
the defendant as admitted by him, under the provision extracted
supra confer the person receiving it, a prima facie authority to
make or complete those. Therefore, since the defendant has
handed over the six signed cheques even with entries other than
the figure showing the money filled up, as holder of it the plaintiff
is given prima facie authority by Section 20 of the N.I. Act to
complete it. Therefore, the argument that by entering the dates in
the cheques, the plaintiff has materially altered the cheques will
not sustain and is discarded.
19. The plaintiff has established before the trial court that
the cheques on presentation for encashment were bounced and the
factum of dishonour was duly informed to the defendant by serving
lawyer notices. Strictly no materials are forthcoming to establish
any repayment towards the interest or the principal sum borrowed.
The plaintiff has tendered oral evidence to establish his claim for
realisation of money. He has also produced relevant documentary
evidence to justify his claim.
R.F.A. No. 201 of 2013
20. The decisions relied on by the learned counsel for the
defendant refer to presumption contemplated under Section 118
N.I Act. In Veluchandran v. Vilasini Amma and others [ILR
2020 (2) Kerala 444], this Court has held that only when the
execution of the cheque is satisfactorily established by the plaintiff,
presumption under Section 118 of the N.I. Act on consideration
would operate to aid the plaintiff seeking realisation of money
based on cheques.
21. In the case on hand the execution of the cheque stands
admitted by the defendant when he admits the factum of availing
of loan from the plaintiff and issuance of cheques. In such a
context, presumption under Section 118 N.I. Act could be drawn
that those were issued for valid consideration. A contention was
raised that his source to advance the huge sum was not
established by the plaintiff and Abdul Khader v. Zubair [2015 (4)
KLT SN 135 (Case No.163)] was relied on to support. In the said
case PW1 has spoken during examination that he has no source of
income and it was held by the court that the said version is
material while drawing the presumption under the N.I. Act. It was
also said by the court in the context that the accused has
discharged his initial burden, successfully.
R.F.A. No. 201 of 2013
22. The decisions relied on by the learned counsel cannot be
said to have any relevance in the context of the case on hand
when the transaction of borrowal of money stands admitted by the
defendant and claim of repayment of a part towards loan stands
disproved.
23. In the case on hand the specific stand of the defendant
was that dates have not been written in the cheques and the
plaintiff has put it prior to presentation of those. The plaintiff has
a contra claim. Evenif the defendant's version is accepted as true,
the filling up of the dates in an otherwise filled and signed cheque,
not being material alteration, will not invalidate it. The plaintiff
being the holder of the cheques undoubtedly has lawful authority
to fill the blank entry under Section 20 N.I.Act. The view on the
point is well fortified by the dictum in Bir Singh v Mukesh Kumar
[2019 (1) KLT 598 (SC)] and is extracted hereunder:
"If a signed blank cheque is voluntarily presented to a
payee, towards some payment, the payee may fill up the
amount and other particulars, and this in itself would not
invalidate the cheque. The onus would still be on the accused to
prove that the cheque was not in discharge of a debt or liability
by adducing evidence."
R.F.A. No. 201 of 2013
24. A scrutiny of the evidence on record convinces this Court
that the trial court had a true and proper appreciation of evidence
and cannot be found fault with in decreeing the suit. Interference
is totally unwarranted. The appeal fails for the reasons.
In the result, appeal is dismissed. No order as to costs.
sd/-
MARY JOSEPH, JUDGE
ttb/07.06
