Madras High Court
A.Parameswaran vs Tirumalayan Finance on 5 November, 2024
2024:MHC:3749
S.A.No.738 of 2018
IN THE HIGH COURT OF JUDICATURE AT MADRAS
JUDGMENT RESERVED ON : 29 / 08 / 2024
JUDGMENT PRONOUNCED ON : 05 / 11 / 2024
CORAM
THE HONOURABLE MR. JUSTICE R.SAKTHIVEL
S.A.NO.738 OF 2018
AND
CMP NO.21476 OF 2018
1.A.Parameswaran
2.Vijayalakshmi ... Appellants / Respondents /
Defendants
Vs.
Tirumalayan Finance
Karaikurichi, Selliyayeepalayam,
Namakkal by its Managing Partner ... Respondent / Appellant /
Plaintiff
PRAYER: Second Appeal is filed under Section 100 of the Code of Civil
Procedure, 1908 praying to set aside the Judgment and Decree dated
March 28, 2017 passed in A.S.No.23 of 2015 on the file of Principal
District Court, Namakkal, reversing the Judgment and Decree dated April
10, 2015 passed in O.S.No.154 of 2005 on the file of Subordinate Court,
Namakkal.
For Appellants : Mr.T.L.Thirumalaisamy
For Respondent : Mr.S.Muthukrishnan
JUDGMENT
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This Second Appeal is directed by the unsuccessful
defendants before the First Appellate Court, against the Judgment and
Decree dated March 28, 2017 passed in A.S.No.23 of 2015 on the file of
‘Principal District Court, Namakkal’ [‘First Appellate Court’ for short],
whereby the Judgment and Decree dated April 10, 2015 passed in
O.S.No.154 of 2005 on the file of ‘Subordinate Court, Namakkal’ ['Trial
Court' for short] was reversed.
2. Hereinafter, for the sake of convenience, the parties will be
denoted as per their array in the Original Suit.
Plaintiff’s Case in Brief:
3. In the Plaint, the plaintiff has averred that the defendants,
who are husband and wife, borrowed a sum of Rs.1,00,000/- with interest
at the rate of 24% per annum, for their family and business expenses on
May 29, 2002, by executing a Promissory Note. On July 2, 2002, they paid
Rs.4300/- towards principal and Rs.1,200/- towards interest. Thereafter,
despite repeated demands, they failed to pay the dues. Hence the Suit for
recovery of sum of Rs.1,61,776/- along with subsequent interest on the
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principal sum of Rs.95,700/-.
Defendants’ Case in Brief:
4. The first defendant filed written statement and the same
was adopted by second defendant. The defendants deny that they borrowed
a sum of Rs.1,00,000/- with interest at the rate 24% per annum, for their
family and business expenses on May 29, 2002, by executing a Promissory
Note. They deny the alleged payment made on July 2, 2002. The first
defendant is working as a conductor in Tamil Nadu State Transport
Corporation and the second defendant is working in Block Development
Office. Both being in government jobs, there is no need to borrow money
from the plaintiff. The signatures and the thumb impressions found in the
Suit Promissory Note are not those of the defendants. Further, the Court
Fee paid is incorrect. Accordingly, they prayed that the Suit shall be
dismissed.
Trial Court:
5. At Trial, on the side of the plaintiff, P.W.1 and P.W.2 were
examined and Ex-A.1 was marked. On the side of the defendants, the first
defendant was examined as D.W.1 and no document was marked.
5.1. Upon hearing both sides and considering the oral and
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documentary evidence, the Trial Court concluded that execution of Ex-
A.1- Promissory Note and the passing of consideration are not proved by
the plaintiff. Accordingly, dismissed the Suit without costs.
First Appellate Court:
6. Aggrieved by the Judgment and Decree passed by the Trial
Court, the plaintiff approached the First Appellate Court by way of an
appeal under Section 96 of the Code of Civil Procedure, 1908 ['CPC' for
short]. The First Appellate Court upon hearing both sides and analysing the
oral and documentary evidence, concluded that the evidence of P.W.1 and
P.W.2 prove the execution of Ex-A.1 - Promissory Note; and that the Trial
Court wrongly understood the concept of burden of proof and dismissed
the Suit without appreciating the evidence in the right perspective.
Accordingly it allowed the appeal, set aside the Judgment and Decree of
the Trial Court and decreed the Suit.
Substantial Questions of Law:
7. Aggrieved with the Judgment and Decree of the First
Appellate Court, the defendants preferred this Second Appeal and the same
was admitted on December 6, 2018 on the following Substantial Questions
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of Law:
“(a) Whether Lower Appellate Court is correct in law
in allowing the appeal without reversing the finding given by
the Trial Court on the various issues?
(b) Whether the Lower Appellate Court is correct in
law in allowing the appeal without reversing the finding of the
Trial Court regarding the evidence of PW2 and the accounts
maintained by respondent?”
Arguments:
8. Mr.T.L.Thirumalaisamy, learned Counsel for the
appellants/defendants would argue that the First Appellate Court’s
Judgment and Decree is not in consonance with Order XLI Rule 31 of
CPC. Though the defendants denied the signatures and thumb impressions
contained in Ex-A.1 - Promissory Note as theirs, the plaintiff did not take
steps to send Ex-A.1 for forensic examination/expert opinion. The burden
is upon the plaintiff to prove the execution of Ex-A.1.
8.1. He would further argue that since the plaintiff is a
partnership firm and the accounts being audited by an auditor, the plaintiff
is supposed to maintain accounts books. When the plaintiff’s contention is
that the defendants paid certain amount on July 2, 2002, the plaintiff ought
to have produced the accounts books to substantiate the same. Adverse
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inference is to be drawn from his failure to do so. The First Appellate
Court failed to consider these aspects in the right perspective and reversed
the Trial Court’s Judgment and Decree, while there was no need for any
need for interference.
8.2. Last but not the least, he would argue that the Suit has
been filed after the period of limitation. Accordingly, he would pray to
allow the Second Appeal, set aside the First Appellate Court’s Judgment
and Decree and restore the Trial Court’s verdict.
8.3. He would rely on the following decision in support of his
contentions:
(i) Siddiqui’s Case - Judgment of
Hon'ble Supreme Court in H. Siddiqui -vs- A.
Ramalingam, reported in (2011) 4 SCC 240.
9. In response, Mr.S.Muthukrishnan, learned Counsel for the
respondent / plaintiff would argue that the plaintiff examined P.W.2 - a
witness to Ex-A.1 - Promissory Note, and proved the execution of Ex-A.1
and pursuant passing of consideration. Hence, Ex-A.1 attracts the
presumption under Section 118 of ‘Negotiable Instruments Act, 1881’
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(henceforth ‘N.I. Act’). Moreover, the plaintiff filed an Interlocutory
Application for subjecting the fingerprints found in Ex-A.1 to expert
opinion and the same was allowed by the Trial Court. Despite sufficient
opportunities, the defendants did not turn up to furnish samples for the
same. Hence, adverse inference is to be drawn from their conduct.
9.1. Further would argue that, the Suit is based on Ex-A.1 -
Promissory Note and not on accounts and hence, there is no need to
produce the accounts. Further, in the Plaint Paragraph No.4, it has been
specifically stated that from April 30, 2005 to June 5, 2005, since the Civil
Courts were on vacation, the Plaint was filed on the day of reopening i.e.,
June 6, 2005. Hence, the Suit is well within the period of limitation. The
Trial Court erred in dismissing the Suit while the First Appellate Court
rightly decreed the Suit by allowing the appeal. Accordingly, he would
pray to dismiss the Second Appeal and confirm the First Appellate Court’s
Judgment and Decree.
Discussion:
10. This Court has heard on either side and perused the
materials available on record in light of the Substantial Questions of Law.
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Limitation
11. Ex-A.1 - Promissory Note is dated May 29, 2002. The
Suit was filed on June 6, 2005. The plaintiff ought to have filed the Plaint
on or before May 29, 2005. However, Paragraph No. 4 of the Plaint
specifically states that since the Civil Courts were on vacation from April
30, 2005 to June 5, 2005, the Suit was filed on the day of reopening viz.,
June 6, 2005. The defendants neither in their Written Statement nor in their
evidence, denied the said specific Plaint averment. Question of limitation
is generally a mixed question of fact and law. In case if it is a purely legal
question, then it can be raised at any time even at the stage of appeal. In
this case, limitation is not a purely legal question. Hence, it cannot be
raised at the stage of appeal. This Court has verified the Official
Memorandum issued by Registrar General in R.O.C.No.3489-A/2004/C3
dated October 8, 2004. Relevant portion of the Official Memorandum
Reads thus:
“R.O.C.No.3489-A/2004/C3
OFFICIAL MEMORANDUM
SUB: Vacation and holidays – Period of adjournment
for vacation and holidays for all Subordinate
Courts in the State for the year 2005 –
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Observance of – Reg.
REF: Civil Rules of Practice and Circular Orders
(Volume – II)
*****
1.The Subordinate Civil Courts in the State of Tamil
Nadu viz., The City Civil Court, Court of Small Causes,
Chennai, District Courts and all other Subordinate Civil
Courts including District Munsif Courts are required to
observe the following period of adjournment in respect of
Summer Vacation for the year 2005.
District Courts and Sub Courts:-
Sunday, the 1st May, 2005 to Sunday, the 5th June, 2005 (both
days inclusive)
District Munsif Courts:-
Sunday, the 1st May, 2005 to Thursday, the 31st May, 2005
(both days inclusive)
... ... ... ...
... ... ... ...
HIGH COURT, MADRAS Sd/-
DATED : 08.10.2004 REGISTRAR GENERAL”
11.1. Verification of the concerned High Court Memorandum
would show that the Courts of District Judiciary were to be reopened on
June 6, 2005 after summer vacation. Hence, even while assuming that plea
of limitation can be raised at the stage of appeal in this case, the conclusion
would be that the Suit is filed well within the period of limitation. In short,
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the Suit is not barred by limitation.
Execution of Promissory Note and Non-production of accounts
12. Defendants in their Written Statement have not denied the
signatures and thumb impressions contained in Ex-A.1 firmly but have
done so evasively. P.W.1 in his evidence deposed that the defendants
executed Ex-A.1 - Promissory Note after receiving Rs.1,00,000/-. Further
deposed that the defendants paid certain amounts towards the principal and
the interest on July 2, 2002. The plaintiff also examined P.W.2 who is a
witness to Ex-A.1. P.W.2 has clearly deposed about the execution and
passing of consideration. Nothing could be elicited through cross-
examination of P.W.1 and P.W.2 so as to shake their chief examination.
Moreover, the plaintiff filed an Interlocutory Application in I.A.No.39 of
2014 before the Trial Court calling upon the defendants to produce their
thumb impression samples for expert opinion. The defendants never came
forward to give the samples. In these circumstances, the evidence of P.W.1
and P.W.2 raise the presumption provided under Section 118 of N.I. Act in
favour of Ex-A.1. Now the onus shifts onto the defendants. They have not
taken any steps to discharge the onus.
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13. The Suit is filed on the basis of Ex-A.1 - Promissory Note.
Had the Suit been filed based on the accounts of the plaintiff or had Ex-A.1
been executed to discharge pre-existing debts standing / based on the
plaintiff’s accounts, in such scenarios, production of accounts book is
necessary. But when the Suit is filed based on Ex-A.1 - Promissory Note,
Promissory Note is considered the best evidence and therefore, this Court
is of the view that there is no need to produce the accounts.
14. In this case, since non-production of accounts is not fatal
to the plaintiff’s case and since the defendants have failed to rebut the
presumption under Section 118 of N.I. Act as stated supra, this Court is of
the opinion that execution of Ex-A.1 and pursuant passing of consideration
have been proved by the plaintiff.
Order XLI Rule 31
15. The First Appellate Court framed the following points for
consideration:
“1) Whether the appellant/Plaintiff has proved the
execution of the promissory note by the defendants?
2) Whether the appeal can be allowed ?”
16. It has discussed on these two points and has assigned
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proper reasons for its decisions thereon. As held in Siddiqui’s Case
(supra), it has independently assessed the evidence on each point. The
brevity of the Judgment alone does not imply that it lacks consideration.
The Judgment is in consonance with Order XLI Rule 31 of CPC. This
Court does not find any infirmity with its Judgment.
Conclusion:
17. The Trial Court failed to consider the fact that the Suit is
based on Promissory Note and erred in its finding that non-production of
accounts is fatal to the plaintiff’s case. Further, the Trial Court erred in
appreciating the evidence of P.W.2 as if the Promissory Note is a
compulsorily attestable document and as if P.W.2 is an attestor while
actually he is a witness. The dismissal of the Suit based on this erroneous
approach of the Trial Court is not sustainable in law. The First Appellate
Court rightly allowed the appeal and decreed the Suit, and this Court does
not find any infirmity with the same. Substantial Questions of Law are
answered accordingly in favour of the plaintiff.
18. Resultantly, the Second Appeal stands dismissed. The
First Appellate Court’s Judgment and Decree is hereby confirmed.
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Considering the nature of the dispute, there shall be no order as to
costs for this Second Appeal. Consequently, connected Civil
Miscellaneous Petition is closed.
05 / 11 / 2024
Index : Yes
Speaking Order : Yes
Neutral Citation : Yes
TK
To
1.The Principal District Court
Namakkal.
2.The Subordinate Court
Namakkal.
R. SAKTHIVEL, J.
TK
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PRE-DELIVERY JUDGMENT MADE IN
S.A.NO.738 OF 2018
05 / 11 / 2024
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