M/S.Amaravathi Finance & Investments vs K.C.Raj
2025 Latest Caselaw 8993 Mad

Madras High Court

M/S.Amaravathi Finance & Investments vs K.C.Raj on 28 November, 2025

                                                                                             S.A.No.664 of 2014


                                  IN THE HIGH COURT OF JUDICATURE AT MADRAS

                                                         DATED: 28.11.2025

                                                                PRESENT:

                                  THE HONOURABLE DR.JUSTICE A.D.MARIA CLETE

                                                        S.A. No. 664 of 2014

                M/s.Amaravathi Finance & Investments,
                by its Proprietor Mr.K.Radhakrishnan,
                No.30, Kutchery Road, Mylapore,
                Chennai – 600004.                                                             ...Appellant

                                                                   Vs.
                K.C.Raj,
                S/o.P.Kunjan,
                A2, Touch Stone Apartments,
                No.10, Vasu Street, Kilpauk,
                Chennai – 600 010.                                                           ...Respondent


                PRAYER: Second Appeal filed under Section 100 of the Code of Civil Procedure
                praying to set aside the Judgment and decree of II Additional City Civil Court,
                Chennai dated 19.08.2013 in A.S.No.122 of 2013 and confirm the Judgment and
                decree passed by the XI Assistant City Civil Court at Chennai dated 05.01.2013 in
                O.S.No.7982 of 2011 and thus render justice.


                                   For Appellant       : Mr. B. Dinesh Kumar.


                1/9




https://www.mhc.tn.gov.in/judis                    ( Uploaded on: 28/11/2025 04:35:12 pm )
                                                                                          S.A.No.664 of 2014




                                                      JUDGMENT

Heard.

2.This Second Appeal is filed against the judgment and decree dated

19.08.2013 in A.S. No.122 of 2013 passed by the II Additional City Civil Court,

Chennai, whereby the judgment and decree dated 05.01.2013 in O.S.No.7982 of

2011 passed by the IX Assistant City Civil Court, Chennai, decreeing the summary

suit for recovery of money in consequence of the dismissal of the leave to defend

petition in I.A.No.98 of 2012, were set aside.

3.The appellant in this Second Appeal is the plaintiff in the original suit. For

the sake of convenience, the parties are referred to as arrayed in the suit.

4.The brief facts of the case necessary to dispose of this second appeal are

as follows:The plaintiff filed a summary suit for recovery of money on the basis of

a promissory note dated 22.05.2009 for a total sum of Rs.4,30,000/- towards

principal and interest, with a prayer for subsequent interest on the principal

amount of Rs.4,00,000/- at 30% per annum.

https://www.mhc.tn.gov.in/judis ( Uploaded on: 28/11/2025 04:35:12 pm )

5.The defendant filed I.A.No.98 of 2012 seeking leave to defend the suit. In

the said application, the defendant raised, inter alia, the following contentions:

i.That the plaint was improperly presented in the name of a proprietary concern, which is a non-juristic person, and not by the proprietor. ii.That there was only a chit transaction and not of any loan transaction as pleaded.

iii.That his signatures were obtained forcibly in blank promissory notes and letters by the representatives of the chit company. iv.That a police complaint was lodged in this regard before Nungambakkam Police Station.

v.That even after the alleged closure of the chit transaction, he paid a sum of Rs.30,000/-.

6.The plaintiff filed a counter denying all allegations. Upon hearing both

sides, the trial court refused leave to defend and dismissed I.A.No.98 of 2012, and

consequently decreed the summary suit on the same day.

https://www.mhc.tn.gov.in/judis ( Uploaded on: 28/11/2025 04:35:12 pm )

7. Aggrieved, the defendant preferred appeal. The first appellate court

allowed the appeal, set aside the judgment and decree of the trial court, and further

observed in the concluding paragraph that "subsequently the suit is dismissed with

cost". However, in the very same paragraph of the judgment, the appellate court

directed the trial court to permit the defendant to file a written statement and to

treat the suit as a regular suit.

8.In this Second Appeal, the appellant raised the following points in the

memorandum of grounds assubstantial questions of law:

(i) Whether the 1st Appellate Courts erred apparent on record in holding that the Lower Court had concentrated only in the point of filing of Suit by the Proprietary concern, when all the points raised by the Respondent had been duly dealt with by the Lower Court in its Order in I.A. No. 98/2012.

(ii) Whether the Respondent is entitled for any unconditional leave when he admits his signature in the Suit Documents and it is his case that he will not execute documents blank but will write the name of Payee and date and amount?

(iii) Whether the 1st Appellate Court granting unconditional Leave entitled to Dismiss the Suit with Cost?

https://www.mhc.tn.gov.in/judis ( Uploaded on: 28/11/2025 04:35:12 pm )

9. On a perusal of the trial court order, it is evident that the trial court

predominantly discussed the issue of maintainability of the suit by a proprietary

concern in its own name. The court ultimately held that such defect does not go to

the root of the matter and is not a triable issue.

10. Though other points were framed, Points Nos.2 to 5 and 6 to 9 were

cursorily dealt with in comparison to the emphasis laid on the maintainability

aspect. The first appellate court’s observation that the trial court primarily

concentrated on this issue is therefore a factual finding. It does not give rise to any

substantial question of law.

11. The first appellate court considered the rival claims relating to two

parallel transactions—one being the chit transaction and the other the alleged loan

transaction.The defendant denied the loan transaction totally, and relied upon the

police complaint alleging coercion. The first appellate court further held that the

presumption under Section 118 of the Negotiable Instruments Act is rebuttable. It

concluded that triable issues arise and leave to defend must be granted.

https://www.mhc.tn.gov.in/judis ( Uploaded on: 28/11/2025 04:35:12 pm )

12. The first appellate court, being the final fact-finding court, has exercised

its discretion upon due appreciation of facts and law. No perversity or illegality

has been demonstrated by the appellant.

13. It is true that in the concluding paragraph, the first appellate court

recorded the words: “subsequently the suit is dismissed with cost”. This

observation is inconsistent with the operative portion of the judgment wherein the

appellate court directed the trial court to permit filing of written statement and

treat the matter as a regular suit. Further, Clause 3 of the decree also

states:"subsequently that the suit be and the same is hereby dismissed".

14. It is apparent that this is an accidental error which has crept into the

judgment and followed in decree. The overall tenor of the judgment of first

appellate court clearly reflects the intention of the appellate court to restore the

suit for trial after granting leave to defend.Such a clerical or accidental error,

which is apparent on the face of the record, is rectifiable and does not constitute a

question of law.

https://www.mhc.tn.gov.in/judis ( Uploaded on: 28/11/2025 04:35:12 pm )

15. No substantial question of law arises for consideration in this Second

Appeal. There is neither misapplication of law nor perversity in the findings of the

first appellate court.However, since an apparent clerical error has crept into the

judgment and decree, the same requires correction.

16. In view of the foregoing discussion, the Second Appeal is dismissed at

the admission stage. However, since a clerical/accidental error has crept into the

judgment and decree dated 19.08.2013 in A.S.No.122 of 2013, the following

directions are issued:

1.The sentence “subsequently the suit is dismissed with cost” appearing in the concluding paragraph of the appellate court judgment is ordered to be deleted.

2.Clause No.3 of the decree reading“subsequently that the suit be and the same is hereby dismissed”is accordingly set aside.

3.The trial court shall restore O.S.No.7982 of 2011 to file.

4.The trial court shall give an opportunity to the defendant to file written statement.

5.The suit shall be treated as a regular suit and disposed of it in accordance with law.

6.The trial court is directed to dispose of the suit expeditiously, preferably within a period of four months from the date of receipt of a copy of this judgment.

https://www.mhc.tn.gov.in/judis ( Uploaded on: 28/11/2025 04:35:12 pm )

7.There shall be no order as to costs.

8.Consequently, the connected miscellaneous petition, if any, stands closed.

                                                                                             28.11.2025
                ay

                Index             : Yes/No
                NCC               : Yes/No
                Speaking Order / Non-Speaking Order


                To

                1.The II Additional City Civil Court, Chennai.

                2.The XI Assistant City Civil Court at Chennai

                3.The Section Officer,
                V.R.Section,
                High Court of Madras.









https://www.mhc.tn.gov.in/judis                ( Uploaded on: 28/11/2025 04:35:12 pm )


                                                                        DR. A.D. MARIA CLETE, J

                                                                                                   ay









                                                                                Dated: 28.11.2025

https://www.mhc.tn.gov.in/judis ( Uploaded on: 28/11/2025 04:35:12 pm )