K.Kanakaiah vs M.Leena
2022 Latest Caselaw 5771 Tel

     THE HONOURABLE SMT. JUSTICE P.SREE SUDHA

                 APPEAL SUIT No.957 of 2004

JUDGMENT:

A.S.No.957 of 2004 is filed against the Judgment of the

trial Court in O.S.No.6 of 2001 dated 12.11.2003.

2. One Muddasani Leela W/o. Srimanth Reddy filed suit for

recovery of amount of Rs.3,06,000/- with future interest @ 24%

per annum against Komirisetti Kanakaiah. The trial Court after

considering the evidence on record and arguments of both sides

decreed the suit in favour of the plaintiff. Aggrieved by the said

order, the defendant in the suit filed an appeal and mainly

contended that evidence of defendant was not considered while

delivering Judgment and the suit was decreed only basing on

the evidence of the plaintiff. He also stated that he issued two

cheques bearing Nos.433372 and 433375 dated 26.09.2000 and

20.01.2001 respectively for an amount of Rs.30,000/- and

Rs.40,000/- respectively. The 1st cheque was issued in the

name of the father of the respondent and the 2nd cheque was

issued in the name of the respondent herein. But, respondent

denied the same.

3. The trial Court after considering the same granted decree

for the entire amount. As the father of the respondent was close

friend of appellant and on request of the appellant hand loan

was given by him, taking the property of the appellant as

mortgage and no promissory note was executed. Basing on the

enquiry report submitted by the Branch Manager, 1st cheque

was drawn by the respondent's father and the 2nd cheque was

also drawn by him, though the said cheque was in the name of

the respondent herein and it is clear that Rs.70,000/- was

received by the respondent and his father. But, the trial Court

wrongly observed that she has not received any amount.

Though appellant requested the Court to permit him to pay

balance loan amount of Rs.2,30,000/- on installment basis, it

was not considered and decree was granted on mere

assumptions and presumptions. Therefore, requested the Court

to set aside the Judgment of the trial Court.

4. Heard arguments of both sides, perused the record. In

plaint it is clearly stated that father of the plaintiff and

defendant are close friends. In view of their close relationship,

the defendant borrowed an amount of Rs.3,00,000/- on

04.01.2000 by mortgaging the house bearing No.4-3-216/8/1,

situated at Bhoomnagar locality of Peddapalli Town and also

agreed to pay the said amount on or before 04.01.2001. But, the

defendant failed to pay the amount even by the end of January,

2001. The plaintiff got issued legal notice on 16.01.2001. After

receiving the legal notice, the defendant neither gave reply nor

paid the suit amount. As such, she filed suit for recovery of

amount with interest @ 24% from the date of filing of the suit till

realization.

5. In the Written Statement filed the defendant he admitted

execution of the equitable mortgage deed in favour of the

plaintiff and further stated that there was no agreement

between the plaintiff and defendant to pay the interest on the

principle amount. As the defendant was very poor, he paid

Rs.30,000/- vide Cheque bearing No.433372 dated 26.09.2000

in favour of the father of the plaintiff namely Shankar Reddy

and issued another Cheque for Rs.40,000/- bearing No.433375

dated 20.01.2001 drawn on the State Bank of Hyderabad,

branch at Peddapalli. But, the plaintiff suppressed the same

and filed suit for entire amount and also claiming interest at an

exorbitant rate and the defendant is not liable to pay future

interest.

6. Plaintiff was examined as P.W.1 and marked Exs.A1 to

A3. Ex.A1 is the registered mortgage deed bearing No.6/2000.

Ex.A2 is the office copy of the legal notice dated 16.01.2001.

Ex.A3 is the postal acknowledgment. The defendant examined

as D.W.1 and marked Ex.B1 dated 08.03.2003, letter issued by

the bank authorities to the defendant. Plaintiff in her evidence

stated that her father gave amount to the defendant and she

was not doing money lending business and her father also not

doing any money lending business. The counsel for the

appellant objected that the suit itself is not maintainable, as she

clearly admitted that amount was lent by his father to the

defendant. During the evidence, she stated that she knows

about the transaction between her father and the defendant, as

they are friends. And she knows what was transpired at the

time of giving loan by her father to the defendant. Therefore, the

argument of the respondent counsel is not tenable and suit filed

for recovery of amount is sustainable.

7. The defendant in the suit admitted the execution of the

mortgage deed and also receiving of Rs.3,00,000/- from the

father of the plaintiff towards hand loan. But, he mainly

contended that he already re-paid Rs.70,000/- by way of two

cheques i.e, on 26.09.2000 and 20.01.2001 respectively and

also filed letter issued by the Branch Manager on 08.09.2003.

In the said letter it was specifically mentioned that Cheque

No.433372 for Rs.30,000/- was issued in favour of M.Shakar

Reddy. It was presented on 27.09.2000 and amount paid to the

bearer. Cheque bearing No.433375 for Rs.40,000/- was issued

in favour of the plaintiff and she presented cheque on the same

day, amount was paid to her and the signature of the bearer is

shown as M.Shankar Reddy. In the Written Statement, plaintiff

father name was stated as Shankara Reddy and both the

cheques were cashed and received by the plaintiff and her

father. But, plaintiff suppressed the same and filed the suit for

entire amount of Rs.3,00,000/- without deducting Rs.70,000/-.

8. In the mortgage deed i.e, Ex.A1, it was clearly mentioned

that the amount was received for the family expenses and

defendant agreed to pay the same without interest within one

year from 04.01.2000, failing which the plaintiff is at liberty to

sell the suit schedule property and recover the same. In this

case, he could not re-pay the amount on or before 04.01.2001.

But, paid Rs.30,000/- on 26.09.2000, it was well within time

and Rs.40,000/- on 20.01.2001, it is after issuance of the legal

notice dated 16.01.2001. The trial Court observed that in a

mortgaged suit the rate of interest shall not exceed 6% per

annum and it was substituted by the Act 66 of 1956 for 9% per

annum. But, the trial Court granted 12% per annum on the

ground that the amount is not paid within the time agreed by

the defendant. In view of the part payment made by the

defendant and also as there is no much delay in the payment of

the amount as legal notice was given on 16.01.2001 for non-

payment of amount on or before 04.01.2001. Moreover, in the

Ex.A1, it was clearly mentioned that there is no interest for the

hand loan, in view of the close acquaintance between the father

of the plaintiff and defendant. This Court finds that the interest

granted @ 12% per annum is excessive and it is to be modified

as 9% per annum. The counsel for the appellant also stated that

he already deposited Rs.2,81,000/- and the said amount was

also withdrawn by the respondent herein. This Court finds that

it is just and reasonable to modify the Judgment and decree of

the trial Court for an amount of Rs.2,30,000/- with interest @

9% per annum from the date of filing the suit till the date of

realization. As the appellant has paid certain amount, he is

directed to pay the balance amount within 2 months from the

date of receipt of a copy of this order.

In the result, appeal is allowed and the order of the trial

Court is modified and appellant is directed to pay balance

amount within two months from the date of receipt of a copy of

this order with interest @ 9% per annum from the date of filing

of the suit till the date of realization.

Miscellaneous petitions pending, if any, shall stand

closed.

_________________________

JUSTICE P.SREE SUDHA

DATED: 11.11.2022

tri

THE HONOURABLE SMT. JUSTICE P.SREE SUDHA

APPEAL SUIT No.957 of 2004

DATED: 11.11.2022

TRI