Kappala Raghu Ramulu vs Kappala Sanath Kumar
2022 Latest Caselaw 6121 Tel

           THE HON'BLE SRI JUSTICE M.LAXMAN

                APPEAL SUIT No. 942 OF 2016

JUDGMENT:

1. The present appeal has been filed challenging the

judgment and decree dated 11.04.2016 in O.S.No.61 of 2012 on

the file of I Additional District Judge, Nalgonda, wherein and

whereby, the suit filed by the respondent against the appellants

for recovery of Rs.17,19,000/- along with pendente lite interest

and costs, was allowed.

2. The appellants herein are defendants and the respondent

herein is plaintiff in the suit. For the sake of convenience, the

parties hereinafter are referred to as they are arrayed in the suit.

3. The short case of the plaintiff is that he and defendant

No.1 are having acquaintance with each other. The plaintiff

purchased land to an extent of Ac.1-00 guntas from defendant

No.1. Whileso, on 31.10.2011, defendant No.1 approached the

plaintiff seeking hand loan to meet his business expenses and

other family needs. In this connection, the plaintiff lent an

amount of Rs.16,00,000/- and defendant No.1 executed a

promissory note on the same day. Defendant no.2, who is the

son of defendant No.1, stood as surety for payment of the

amount lent in favour of defendant No.1 and the same was

reduced into writing in the presence of the witness and scribe.

On account of non-payment of money, there was exchange of

notices between the parties; even then, when the said amount

was not re-paid by the defendant No.1, the present suit has

been filed by the plaintiff.

4. The case of the defendants is that they denied the loan

transaction for an amount of Rs.16,00,000/- and submitted that

there were previous transactions between the parties for smaller

amounts not exceeding Rs.50,000/-. Accordingly, the plaintiff

must have used the previous promissory note, which defendant

No.1 executed in blank, to lay the present claim or the plaintiff

might have forged the promissory note, taking advantage of

availability of signature of defendant No.1, in order to pressurize

defendant No.1 to sell his half acre of land, which is abutting to

the land purchased by the plaintiff from defendant No.1 earlier.

According to the defendants, there is alteration of amount in the

security part of Ex.A-1/promissory note. Hence, they prayed to

dismiss the suit.

5. On the basis of above pleadings, the following issues were

framed by the trial Court:

"1. Whether the plaintiff is entitled for recovery of the amount, as prayed for?

2. Whether there are any material alterations in the suit pro-note, so, the suit is not maintainable?

3. Whether the suit pro-note was brought into existence in the circumstances as prayed by the defendants?

4. Whether the suit pro-note is forged and fabricated?

5. To what relief?"

6. The plaintiff, in support of his case, examined P.Ws.1 to 3

and relied upon Exs.A-1 to A-8. The defendants, to support

their case, examined D.W.1 and got marked Exs.B-1 and B-2.

7. The trial Court after appreciating the evidence on record

has not accepted the defence set up by defendants and decreed

the suit in favour of the plaintiff. Hence, the present appeal at

the instance of defendants.

8. Heard both sides.

9. In the light of above submissions, the points emerged for

consideration in this appeal are as follows:

"1. Whether the Ex.A-1 promissory note is supported by consideration?

2. Whether the plaintiff is entitled to recover the amount as prayed for?

3. To what relief?"

Point Nos.1 and 2:

10. As seen from the evidence adduced by both the parties

there is clear admission from defendant No.1 that signature on

Ex.A-1 belongs to him. This means his plea of forgery does not

sustain anymore. Once the execution of document is admitted,

the presumption under Section 118 of Negotiable Instruments

Act, 1881 is available in favour of the plaintiff. Then, the

burden shifts to defendants to rebut such presumption and once

such defence is made out probablising the case, the burden

again shifts to the plaintiff to establish the transaction.

11. In the present case, the defence set-up by the defendants

is that there is no transaction relating to amount of

Rs.16,00,000/-. Their second ground is that the plaintiff filed

the present suit, in order to exert pressure on defendant No.1 to

sell his balance half acre land, which is abutting to the land

which he already sold to plaintiff. The third plea set-up by

defendants was that the plaintiff has no capacity to lend an

amount of Rs.16,00,000/- and further, defendant No.1 had no

necessity to borrow such huge amount of money. The fourth

defence set-up by defendants is that a promissory note which he

had executed previously in blank to avail loan amount was used

by the plaintiff for the present claim.

12. The plaintiff in support of his contentions got examined

himself as P.W.1 and also examined P.W.2, who is the attestor to

Ex.A-1 and P.W.3, who is scribe of Ex.A-1. The initial pleadings

of the plaintiff and the contents of the Ex.A-1 does not reflect

the name of the scribe of promissory note. It is not disputed

that except the signature part, the rest of the part of Ex.A-1 was

not accepted by executant of document.

13. It is the case of plaintiff that the writing on Ex.A-1 belongs

to P.W.3. The name of P.W.3 first appeared in the evidence of

P.W.2. There is no reference of his name in the promissory note.

The evidence of P.W.1 also shows that he is having close

acquaintance with P.W.2, as he stays near to his house; in fact,

they are related to each other. The evidence of P.W.1 shows that

during the cross-examination of P.W.1, P.W.2 was present in the

Court hall. Hence, the defence of defendants was known to

P.W.2.

14. P.W.1 admitted that there are previous loan transactions

between himself and defendant No.1. He also admitted that in

the said previous transactions, he never lent more than

Rs.50,000/- to defendant No.1. He further admitted that he

purchased one acre land from defendant No.1 and one acre from

the brother of defendant No.1. In his cross-examination, P.W.1

also admitted that he does not know the extent of land which

was held by defendant No.1. The evidence of defendant No.1

shows that he was running TATA Sumo vehicle on rent. No

evidence is placed on record to show that the defendant No.1

was doing real estate business. The P.W.2 tried to establish in

his evidence that defendant No.1 was doing real estate business

in Miryalguda, but he failed to submit any proof in this regard.

The evidence of P.W.2 also shows that defendant No.1 never

borrowed more than Rs.50,000/- from the plaintiff.

15. The evidence of P.W.1 does not show the extent of land

owned by defendant No.1. P.W.1 tried to set up that he secured

the money by sale of plots situated in Miryalguda and lent the

same to defendant No.1. He submitted that the said plots were

sold to one Thirupati for sale consideration of Rs.14,50,000/-.

However, he has not produced any proof as to the sale of plots.

He only referred to document bearing No.4327/2011 during the

cross-examination of D.W.1, but said document is not reflected

in the encumbrance certificate i.e., Ex.B-1 produced by the

defendants. This demolishes the case of plaintiff that money he

lent was secured by sale of plots. When such evidence is on

record, the existence of previous loan transactions, existence of

P.W.1's land abutting to defendant No.1's remaining land and

execution of blank promissory notes previously demonstrates

that the defence set-up by the defendant No.1 to rebut the

presumption is probable. Once, this defence is probable, then

the burden shifts to plaintiff to establish that there is a loan

transaction of Rs.16,00,000/- and consideration was paid to

defendant No.1.

16. Plaintiff failed to establish that he sold plots and secured

an amount of Rs.14,50,000/-. The evidence of P.W.2 cannot be

believed as he is interested witness, since he has close

acquaintance with the plaintiff. The name of P.W.3 first

appeared during the evidence of P.W.2 and his name is not

reflected either in pleadings or on Ex.A-1. Further, evidence of

P.W.3 cannot be believed, as he is also close acquaintance of

plaintiff. Therefore, such evidence requires further

corroboration and such corroboration is lacking in the present

case.

17. In the said circumstances, the plaintiff has failed to set-up

his case of lending an amount of Rs.16,00,000/- to defendant

No.1. Hence, the appeal is liable to be allowed by setting aside

judgment and decree passed by the trial Court.

Point No.3:

18. In the result, the appeal is allowed setting aside judgment

and decree dated 11.04.2016 in O.S.No.61 of 2012 on the file of

the I Additional District Judge, Nalgonda. Consequently, the

O.S.No.61 of 2012 is dismissed. There shall be no order as to

costs. Miscellaneous petitions, if any, pending, shall stand

closed.

_______________ M.LAXMAN, J

Date: 24.11.2022 GVR