Telangana High Court
Vadlakonda Srinivas vs Marumamula Sandeepa Rushi on 4 April, 2024
THE HON'BLE SRI JUSTICE SAMBASIVARAO NAIDU
SECOND APPEAL No.922 OF 2016
JUDGMENT :
Being aggrieved by the Judgment dated 13.04.2016
in A.S.No.34 of 2014 on the file of VI Additional District
Judge, Siddipet, by which his first appeal against the
Judgment and Decree of the trial Court in O.S.No.56 of
2012 dated 22.08.2014 whereunder a decree for recovery of
money was granted in favour of the respondent/plaintiff,
was dismissed, this Second Appeal has been filed by the
defendant in the original suit under Section 100 Code of
Civil Procedure (for short "CPC"), assailing the Judgment of
the 1st appellate Court on the following grounds:
The trial Court and 1st appellate Court ought to have
seen that Ex.A1 the alleged promissory note which is
without any date, month and year, is not a valid document
in the eye of law, as such suit on the basis of such a
promissory note is not maintainable.
SA.No.922 of 2016
2. The appellant has claimed that respondent/plaintiff
has to be non-suited as there is no cause of action and as
no suit can be filed on the promissory note without any
date of the instrument and it would cause serious prejudice
to the appellant. The Courts below committed a wrong in
passing a decree on the basis of Ex.A1 which according to
the appellant herein is not a valid document in the eye of
law. He has also claimed that the trial Court and 1st
appellate Court ought to have seen that Ex.A2 cannot cure
the defect in the promissory note. The appellant claims that
according to Section 20 of Negotiable Instruments Act, 1881
(for short "N.I.Act.") it enables the holders of document to fill
the date only and as such the Courts below committed an
error in observing the instrument is valid under Section 20
of N.I.Act. The appellant has claimed that the Courts below
misconstrued the pleadings and evidence, thereby come to
an erroneous conclusion. The Courts below ought to have
seen that the evidence did not prove the borrowing of the
amount by the appellant or execution of promissory note by
him. Therefore, sought for setting aside the impugned
judgment.
3. As could be seen from the Judgment of the trial
Court in O.S.No.56 of 2012 and the Judgment of the 1st
appellate Court in A.S.No.34 of 2014, it seems the
respondent/plaintiff has filed original suit against the
present appellant for recovery of money on the basis of
promissory note said to have been executed by the present
appellant. According to the plaint filed by the respondent
before the trial Court, he has pleaded that the appellant
borrowed an amount of Rs.3,00,000/- from him in the first
week of January, 2011, executed the promissory note and
receipt vide Ex.A1. The appellant herein filled up the
contents of the promissory note, but kept the columns of
date, month and year in the promissory note as blank by
giving an option to the respondent/plaintiff to fill the same
whenever necessary. He has also pleaded that the appellant
herein agreed to repay the amount with interest @18% per
annum. But, there was failure in payment of the money, as
such the respondent sought for recovery of amount due
under the promissory note.
4. The appellant herein resisted the claim, filed a
written statement with a particular plea that he used to
borrow petty loans of meager amounts from the respondent
and used to pay the same. The respondent used to obtain
promissory notes from him. Therefore, according to the
appellant he has received some petty amounts from the
respondent, but paid the outstanding amount through
cheque as final settlement. The respondent promised the
appellant that he would return the promissory notes, but
filed the suit for recovery of money. As such, according to
the appellant he is not liable to pay any amount and he
prayed for dismissal of the suit.
5. The following issues were framed by the trial Court.
1. Whether the plaintiff is entitled to decree for
recovery of Rs.3,67,500/- with costs and interest
as prayed for?
2. To what relief?
6. During the trial the respondent himself was
examined as PW1 and he has examined one of the attestors
of the suit promissory note and letter executed by the
present appellant as PW2. Exs.A1 to A5 were marked. The
appellant herein was examined as DW1 and he has marked
Exs.B1 and B2. The trial Court believed the claim of
respondent and passed a decree for recovery of the suit
amount. The 1st appeal filed by the appellant herein was
dismissed on contest and on merits.
7. This Second Appeal has been admitted on the
following substantial questions of law:
a. Whether the courts below are correct in decreeing the suit
without date, month and year on the Promissory Note which
seriously prejudice the cause of action with reference to law of
limitation?
b. Whether the Promissory Note without date, month, year is
executable when in Ex.A2 also does not mention the date of the
alleged transaction. The respondent / plaintiff has not availed
the opportunity to fill the date under Section 20 of Negotiable
Instruments Act, 1881.
c. The courts below are correct in decreeing the suit, the
respondent / plaintiff is not having money lending license when
the respondent / plaintiff admitted that he has lent money to
other person also.
d. Whether Judgment and Decree of court below is correct placing
reliance on Section 20 of Negotiable Instrument Act when the
respondent / plaintiff has not filled the contents of date, month
and year in the blank Promissory Note.
8. Heard both parties.
9. According to the pleadings and evidence produced
by the respondent, it was his specific contention that the
present appellant having borrowed Rs.3,00,000/-, executed
a promissory note in his favour, but he was given liberty to
fill up the date on the promissory note. To prove his claim,
apart from examining himself as PW1, he has examined
PW2 to prove the contents of Exs.A1 and A2-letter.
10. The appellant, who has admitted the practice of
borrowing money from the respondent, took a specific stand
that he has discharged the entire outstanding amount, but
there was failure by the respondent in returning the
promissory notes. He has also claimed that the suit
promissory note in view of the alleged defect is an invalid
document and respondent cannot sue him for recovery of
money.
11. The trial Court as well as 1st appellate Court
accepted the oral and documentary evidence of PWs 1 and
2. The appellant while filing the written statement before
the trial Court, in spite of his claim that he used to borrow
petty amounts from the respondent, has also claimed that
with regard to suit amount, the respondent has no capacity
to pay such a huge amount as hand loan. There is no
explanation from the appellant as to why he did not insist
the respondent for return of all the promissory notes when
he was able to discharge the entire amount that too by way
of cheque.
12. According to the notice issued by the appellant
herein under Ex.A3 he has claimed that respondent forced
him to execute the documents for Rs.3,00,000/- payable
with interest @ 18% per annum. Therefore, by the said
averments in the reply notice, the issuance of which is not
in dispute, the respondent is able to prove execution of the
promissory note. Whereas, the appellant was not able to
prove the contention that he has executed the said
promissory note at the pressure of the respondent.
13. It is in the evidence of DW1 that he has borrowed
money from the respondent more than 10 times during
2002-2005. However, he has claimed that the highest
amount which he borrowed from the respondent was
Rs.30,000/-. It is not known why the appellant herein
executed the promissory note for Rs.3,00,000/-, if he
borrowed money to the tune of Rs.30,000/-. It is not the
case of appellant that he did not fill up the suit promissory
note. Therefore, in view of the presumption under the
N.I.Act, when once the execution of the promissory note is
proved, it shall be presumed that the promissory note was
executed for consideration.
14. It is true the respondent has contended that the
suit promissory was filled up by the appellant herein, but
he did not fill up the date in the promissory note and the
respondent was given liberty to fill it up. According to
Section 20 of N.I.Act., where one persons signs and delivers
to another a paper stamped in accordance with the law
relating to Negotiable Instruments then in force in India,
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.
15. In a recent Judgment in Appeal Suit vide
A.S.No.301 of 2009, the High Court at Amaravathi ruled
that inchoate or incomplete documents that are stamped in
accordance with law relating to Negotiable Instrument are
legal instrument under Section 20 of N.I.Act.,
16. According to Section 20 of N.I.Act., it makes
inchoate and incomplete stamped instrument as legal
documents. The evidence produced by the PWs 1 and 2
makes it clear that the appellant herein did not dispute the
signature and execution of the document. Therefore, in
view of the Section 20 of N.I.Act., the respondent-plaintiff is
entitled to claim the suit amount on the basis of the said
document. Therefore, the trial Court as well as the 1st
appellate Court rightly held the liability of the appellant
against the respondents.
17. Therefore, there are no grounds to interfere with
the concurrent finding of the trial Court as well as the 1st
appellate Court. As such, the appeal is liable to be
dismissed.
18. In the result, the appeal is dismissed. No costs.
As a sequel, pending Miscellaneous Applications, if
any, shall stand closed.
___________________________________
JUSTICE SAMBASIVARAO NAIDU
Date:04.04.2024
PSSK
