M. Venugopal, J.@mdashThe Appellants/Defendants have filed this present Appeal as against the Judgment and Decree dated 31.01.2002 in
O.S. No. 95 of 2000 passed by the Learned Additional District Judge, Karaikal.
2. The trial Court, in its Judgment, on an appreciation of oral and documentary evidence available on record, has, among other things, observed
that ''the suit pronote-Ex.A.1 dated 15.03.2000 has been executed by Alexander and that the Respondent/Plaintiff is entitled to the Judgment and
Decree as prayed for in the plaint and accordingly, directed the Appellants/Defendants to pay the suit amount along with interest.''
3. Before the trial Court, 1 to 3 issues have been framed for adjudication, in the main case. On the side of Respondent/Plaintiff, witnesses P.W.1
and P.W.2 have been examined and Exs.A.1 to A.26 have been marked. On the side of Appellants/Plaintiffs, witness D.W.1 has been examined
and Exs.B.1 to B.29 have been marked.
4. Being aggrieved against the Judgment and Decree passed by the trial Court in the main suit, the Appellants/Defendants have preferred the
present Appeal as aggrieved persons.
5. The Points that arise for determination in this Appeal are:
(i) Whether the suit pronote Ex.A.1 dated 15.03.2000 has been executed by Alexander (later deceased) for a valuable consideration?
(ii) Whether the Respondent/Plaintiff is entitled to claim the suit amount of Rs. 2,17,500/- together with interest at 12% per annum etc.?
Contentions, Discussions and Findings on Point Nos. 1 and 2:
6. According to the Learned Counsel for the Appellants/ Defendants, the trial Court should have held that the suit Ex.A.1Pronote dated
15.03.2000 has been a fabricated one for the purpose of the case and moreover, D.W.1 in her evidence has clearly stated that the signature
appearing on the suit pronote seems to be that of her father and also she has added that the said signature does not have the usual characteristics of
her father signature and as such, the trial Court has gone wrong in holding that the witness D.W.1 has admitted the signature to be that of her father
in the pronote.
7. The Learned Counsel for the Appellants urges that the trial Court having held that the Respondent/Plaintiff enjoyed a fiduciary relationship with
the late Alexander and in fact, the trial Court must have held that the burden of establishing that the suit pronote has been really executed by the
deceased Alexander and consideration of Rs. 2 lakhs really passed thereunder is on the Respondent/Plaintiff, but this burden has not been
discharged by the Respondent/Plaintiff, which has not been appreciated properly by the trial Court and added further, the trial Court has not drawn
an adverse inference against the Respondent/Plaintiff because of the fact that P.W.1/Plaintiff in her evidence has stated that the late Alexander has
taken out the printed pronote from the drawer, affixed stamp thereon and signed but it is the Respondent/Plaintiff who has written the figure of Rs.
2 lakhs mentioned in the pronote.
8. Advancing her arguments, it is the submission of the Learned Counsel for the Appellants that P.W.2 has not witnessed the execution of pronote
by the late Alexander and the mere fact that the Respondent/Plaintiff is able to produce documents like loan applications etc. clearly go to prove
that she has not only the access but the control and custody of the papers of late Alexander and even assuming that the signature seen on the
pronote is genuine, the inescapable conclusion is that P.W.2/Plaintiff has misused the same.
9. Proceeding further, the Learned Counsel for the Appellants contends that in Ex.A.5 copy of the letter dated 15.09.2000 P.W.1/ Plaintiff refers
to an amount of Rs. 1,60,000/- as due payable under the pronote but the Ex.A.1-Pronote dated 15.03.2000 contents the figure of Rs. 2,00,000/-
but this aspect of the matter has not been adverted to by the trial Court in its Judgment.
10. That apart, it is the contention of the Learned Counsel for the Appellants that P.W.1/Plaintiff has not produced the passbook of her bank
accounts and in cross examination P.W.1 has deposed that she earned a paltry sums by way of LIC Commission and indeed, she does not have
the requisite mense to advance a huge sum of Rs. 2,00,000/-.
11. On the side of the Appellants, the Learned Counsel for the Appellants projects a plea that the Respondent/Plaintiff (P.W.1) has been in
complete charge of the school admission and further that she has operated the bank accounts and moreover, the cashier of the concerned bank is
the husband of the Respondent/Plaintiff and therefore, the burden of proof lies strongly on the Plaintiff and that has not discharged by the
Respondent/Plaintiff in the present case on hand.
12. Also, it is the submission of the Learned Counsel for the Appellants that the trial Court should have applied Section 106 of the Indian Evidence
Act in regard to the purported execution of Ex.A.1-Pronote dated 15.03.2000 by the late Alexander and since the Respondent/Plaintiff (P.W.1)
enjoyed a position of total trust, all relevant facts pertaining to the suit transaction lay within the special knowledge of the Respondent/Plaintiff.
13. In short, the contention of the Learned Counsel for the Appellants is that the trial Court is not looked into the material factual aspects of the
matter coupled with the legal position in a proper perspective, which has resulted in the impugned Judgment being passed against the Appellants by
the trial Court in the main suit and therefore, prays for allowing the Appeal.
14. Conversely, it is contention of the Learned Counsel for the Respondent/Plaintiff that the trial Court has appreciated the relevant facts and
circumstances of the case in an attendant fashion and has also analysed the available oral and documentary evidence on record and has decreed
the suit as prayed for by the Respondent/Plaintiff and granted the interest together with costs and the same need not be interfered with by this
Court at this stage of the Appeal.
15. It is the evidence of P.W.1 [Respondent/Plaintiff] that the 1at Defendant''s husband Alexander [1st Appellant''s husband] on different dates has
received a loan of Rs. 2,00,000/-from her, for which he executed a pronote dated 15.03.2000, agreeing to repay the amount with 12% interest
per annum and that Alexander (since deceased) has been a Lawyer and has been running a school and he has no regular income and he has been
getting a low income which is more than the expenses from running the school and Alexander has received the suit loan for his personal and school
administrative expenses and since the loan has reached a limit of Rs. 2,00,000/- he has executed a pronoteEx.A.1 dated 15.03.2000 in her favour
and that he expired on 26.07.2000.
16. It is the further evidence of P.W.2 that she asked the Appellants/ Defendants to repay the pronote sum and that they are aware of the pronote
loan and as such she has issued a lawyer''s notice on 25.10.2000 to the Appellants/Defendants and Ex.A.2 is the copy of the lawyer''s notice
dated 25.10.2000 and in Ex.A.5 letter dated 15.09.2000 she has mentioned about the suit pronote and even after the receipt of the said letter the
1st Appellant/ 1st Defendant has not paid the money back and has not given a reply and she has served as a Teacher in the private school run by
the said Alexander and she has also serving as a LIC Agent and Ex.A.6 receipts in respect of the year 1999-2000 for the LIC commission which
she has received and her husband Abdul Gaffar has been working as Officer in Indian Oversees Bank, Thirupattinam Branch on a monthly salary
of Rs. 14,650.54 and Ex.A.7 is the certificate issued by the Bank and her son has been working as Software Engineer in S.S.I. on a monthly
salary of Rs. 4,100/- and Ex.A.8 is the certificate to that effect and she has been living with her husband and son as a one family and on
10.05.2000 the 1st Appellant/1st Defendant''s husband [since deceased] has executed Ex.A.9 Sale Deed to herself and another two persons and
she along with another with Alexander has entered into a rent deed on 08.06.2000 which is Ex.A.10 and as against Alexander an attachment
warrant has been issued for sum of Rs. 53,000/- in E.P. No. 44 of 1999 and when the Amin has effected attachment of movable properties she
and another person stood as sureties and handed over the movables to Alexander and that amount has not been still paid and that Execution
Petition is pending for collection of the balance amount and Alexander has asked to right the Ex.A.1-Pronote.
17. P.W.1 in her evidence goes on to add that S.B. Account No. 4951 stands in the name of School and Alexander has given her account number
to operate the bank account and the S.B. Account No. 4951 after the death of Alexander has not been operated by any one and in the year 2000
in Nedungadu I.O.B. Bank in the name of partnership an Account No. 5755 has been opened and on 01.05.2000 the partnership company has
been formed in which she has been the Managing Partner and in the said partnership company, the Alexander has been the partner and each one
has invested a capital of Rs. 1,10,000/- and formed the partnership and on 10.05.2000 Alexander has sold a property to the school for Rs.
90,000/- and on 08.06.2000 Alexander in favour of the school has executed a rent deed for 20 years and in the Rent Deed in Ex.A.10, the
monthly rent mentioned is Rs. 1000/- and says a clause that rent ought not be increased for 20 years.
18. Besides the above, it is the evidence of P.W.1 that she does not know that in the year 1999-2000 Alexander has sold the properties worth
several lakhs and on the date of Ex.A.1-Pronote, she has not drawn any money from the Bank and in Ex.A.1-Pronote one Govindasamy has
signed as a witness and she has not written a note on what dates she has given how much money to Alexander and further that she has mentioned
the amount in Ex.A.1-Pronote from her memory and in Ex.B.22 at page 2 she has mentioned that the total amount that she has lent on different
dates is Rs. 1,60,000/- and it is wrong to state that at the time of Ex.A.1-Pronote she has no means to pay Rs. 2 lakhs. Further, it is the evidence
of P.W.1 that in Ex.A.1 Pronote date has been mentioned and later in the date the 10th month is corrected as 3 in Ink and Exs.A.21, 22 are the
loan applications submitted through her by Alexander for obtaining loan from outside in which he has signed and since the loan has not been
sanctioned in respect of these applications, they have remained with her and Alexander has received a principle sum of Rs. 1,60,000/- from her
and including the interest has executed a pronote for Rs. 2,00,000/- and the accounts have been written as per direction of the correspondent.
19. P.W.2 in his evidence has deposed that he has served in the Alexander''s Dominic Xavaio shcool as a Headmaster for 4 1/2 years and
Alexander has been a Lawyer but he has left the practice and he has political and social connections and that he has been running the school and
he has been possessed of many properties but not getting the income and the income which he has received from the school has not been sufficient
towards expenses incurred for the van purchased and from the school income Alexander used to donate the temple and political people and for the
family expenses Alexander has taken money from the school and the income from the school has not been sufficient for payment of salary to the
school Teachers and therefore, Alexander used to obtain loan and pay the salary to the Teachers and that he has on several occasions borrowed
money and given to the Alexander and even the Respondent/Plaintiff who has been working in the school used to give money to Alexander and for
payment of money no account is maintained and the Respondent/Plaintiff because of the trust on Alexander has been having lending transactions
and that Alexander has executed a pronote date 15.03.2000 for a sum of Rs. 2,00,000/- and Alexander has not mentioned about the interest.
20. Added further, it is the evidence of P.W.2 that Alexander asked him to sign in Ex.A.1-Pronote and that he has signed and Ex.A.1-Pronote has
been ordered to be written by Alexander and the same has been written by P.W.1 and after reading the pronote Alexander has affixed his
signature and thereafter, he has affixed his signature and thereafter he has affixed is signature and that the pronote has been filled up before he and
Alexander have affixed their signatures.
21. It is the evidence of P.W.2 (in cross examination) that at the time of execution of Ex.A.1-Pronote he has not served in the Alexander school
and at that time he has been working in Karaikal Naluman Hostel and Alexander has phoned up to him from Nedungadu asked him to come to his
place and he met Alexander in the school on receipt of the Phone call and the suit pronote has been kept on the table, when he has gone there and
because of the Respondent/Plaintiff''s insistence for record purpose, since he has to execute a pronote he has asked him to come and he asked me
to sign as a witness and accordingly, he has signed the same and in the pronote Alexander informed him that two times a signature has to be
affixed.
22. It is the evidence of D.W.1 [2nd Appellant/ 2nd Defendant] that his father died on 26.07.2000 and his father owned three vellies of nanja and
three vellies of punja land (dry) and he has been owning an ancestral house and also a plot and further he has been running a High School Dominic
Xaveio High School, at Nedungadu, Karaikal and his mother (1st Appellant/ 1st Defendant) owns flour mill and a plot at Villupuram and she is a
Partner L.P.G. Transports at Mangalore and he has been serving as a part time lecturer and she has been serving as a part time lecturer in Avvayar
Government College for women at Karaikal from October, 1999 to April, 2000 and his father has sold the properties worth Rs. 9 lakhs and her
mother has sold her properties worth Rs. 2 lakhs in the year 2000 and his father has started the school in the year 1990 and that the
Respondent/Plaintiff joined the school in the same year as a Teacher and subsequently, she assumed the post of Manager of the school and that the
Plaintiff has served as an Assistant Headmaster for one year.
23. It is the further evidence of D.W.1 that the Respondent/ Plaintiff (P.W.1) has been writing the accounts of the school and the school is having a
Savings Bank Account number at Nedungadu is 4951 and the new account number is 5755 and that the Respondent/Plaintiff operating the said
account by depositing and withdrawing money and his father has been a Lawyer and he has been not practicing as a Lawyer and there has been no
compelling necessity for her family to raise loan during March 2000 and there is no necessity of raising loan even prior to March 2000 and their
family has been financially in a sound position and the school has been running a profits as per accounts and after the demise of her father, herself
and her mother are managing the school and running the school on profits.
24. Continuing further, it is the evidence of D.W.1 that it is incorrect to state that father viz., Alexander raised loan of Rs. 2,00,000/- on Ex.A.1-
Pronote dated 15.03.2000 and no entry in school accounts in respect of the alleged loan of Rs. 2,00,000/- and there is no personal account for
her father and that the funeral ceremony of his father has not been attended by the Respondent/Plaintiff and that her father has not executed the suit
pronote at any point of time and the account book discloses the borrowings of her father and she has produced the .... that no entries of loans of
the Respondent/Plaintiff in respect of Ex.A.1-Pronote and to show that the school has not been running on loss.
25. A perusal of Ex.A.1-Pronote dated 15.03.2000 shows that a sum of Rs. 2,00,000/- has been received in cash by the Alexander on different
dates for the purpose of school''s urgent need, family expense and for school administrative expenses and the rate of interest is mentioned as 12%
In Ex.A.1 Pronote dated 15.03.2000 P.W.2, Govindasamy has signed as a witness. In Ex.A.1 over the one rupee stamp Alexander has signed
and on the left hand side of the pronote it is specifically mentioned that the Ex.A.1-Pronote has been written by the Respondent/Plaintiff viz.,
P.W.1. In Ex.A.1-Pronote dated 15.03.2000 the Respondent/Plaintiff has affixed a signature in English, though the printed pronote has been filled
up in Tamil words by the Respondent/Plaintiff.
26. It is to be noted that until the contrary is established, every negotiable instrument which is duly made or deemed to have been made must prima
facie be held to be one supported by consideration as per decision A. Palanisamy v. M. Kuppusamy (2000) 2 MLJ 334.
27. In R. Shanmuga Rajeswara Sethupathi v. Chidambaram Chettiar and Ors. (1938) 1 MLJ 597 the Privy Council has held thus:
Where a promissory note has been given, consideration is to be presumed and the burden to prove that there was no consideration for the
promissory note is upon the executant.
28. It is true that mere admission of a signature on a blank sheet is not an admission of execution of instrument. Since the Plaintiff discharges the
burden successfully, the presumption u/s 118 of the Negotiable Instruments Act, 1881 requires him to shift the burden to the other side viz., the
burden of establishing the case is on the Defendant. When presumption u/s 118 of the Negotiable Instruments Act is available to the Plaintiff, the
burden is on the Defendant to disprove the same. Where the Defendant says that the signature seen on Ex.A.1 is that of the Alexander, it is no
admission of execution and the Respondent/Plaintiff must establish due execution of Ex.A.1-Pronote dated 15.03.2000. Only when the execution
of Ex.A.1Pronote is proved, a Court of Law will raise a presumption that instrument has been made for consideration and this presumption will lost
long, till the contrary is established.
29. It is not out of place for this Court to point out that where parties lead evidence in regard to consideration and if a Court of Law on the scrutiny
of entire evidence comes to a conclusion that no consideration is ever passed from the Respondent/Plaintiff to the Defendant, the presumption u/s
118(a) cannot help the Plaintiff.
30. In Narayan Rao v. Venkatappya AIR 1937 Mad 182 it is observed as follows:
It had to be borne in mind that when evidence has been adduced on both sides, the question of onus is material or deciding factor only in
exceptional circumstance and that even the onus u/s 118 of the Negotiable Instruments Act need not always be discharged by direct evidence.
31. The core contention advanced on the side of the Appellants/ Defendants is that the Respondent/Plaintiff (P.W.1), being the trusted servant of
the deceased Alexander, has abused her position and has created the suit pronote fraudulently. Further, the Appellants/ Defendants in the written
statement have stated that the deceased Alexander has sold his property in the year 1999 for several lakhs and his wife has sold her properties
worth several lakhs in the year 2000 and therefore, Alexander and members of his family have been financially sound and as such, there is no need
for Alexander to raise any loan from the Respondent/Plaintiff and it is incorrect to state that Alexander has no regular source of income.
32. Though, on the side of the Appellants/Defendants, a plea has been taken that the deceased Alexander has been in a sound financial position,
since he has sold his properties in the year 1999 and his wife viz., the 1st Appellant has sold her properties worth several lakhs in the year 2000
and that the 2nd Defendant (D.W.1) is a College Lecturer etc., it is seen from Ex.A.12 and A.13-Warrant Copy and Bond Copy, the articles have
been attached and they have been handed over in custody to the Respondent/Plaintiff and the Teacher and as such, the contra plea taken by the
Appellants/Defendants that the Alexander has been in a good position and that too in affluence circumstances is not accepted by this Court.
33. In the present case, the evidence of P.W.2 [a witness in Ex.A.1-Pronote dated 15.03.2000] gains importance very clearly has stated that the
income received from the school has not been sufficient for meeting out the expenditure of the school van and further that Alexander has been in
the habit of giving donation to temple, political and temple people from and out of the income of the school and further he used to take money from
the school income for his family expense and that the income received from the school has not been sufficient for payment of salary to the school
Teachers and therefore, he has, on several occasions, obtained the loan and given to Alexander and moreover, the Respondent/Plaintiff working in
the school has also used to lend money to Alexander and Ex.A.1-Pronote dated 15.03.2000 has been executed by Alexander in favour of P.W.1
(Plaintiff) and only Alexander has asked P.W.1 to write the Pronote and only after reading the contents of Pronote, Alexander has signed and
thereafter he has also signed and that apart, before Alexander and himself affixing the signature in the Pronote, it has been filled up.
34. Significantly, P.W.2 in his evidence has stated that Alexander has not said anything about the interest. The evidence of P.W.2 a witness of
Ex.A.1-Pronote dated 15.03.2000 to the effect that Alexander has signed Ex.A.1-Pronote and further since the Plaintiff has been troubling the
Alexander, the said Alexander has executed the Pronote in her favour, is certainly a favourable one in favour of the Respondent/Plaintiff. Further,
P.W.1 (Respondent/Plaintiff) has stated that Ex.A.1-Pronote dated 15.03.2000 has been written by her and that for the loan taken by Alexander
on different dates he has executed the suit Pronote in regard to the school''s urgent expenses, family expense and for the purpose of school
administrative expense. Therefore, it is candidly clear from the evidence of P.W.1 and P.W.2 that deceased Alexander has executed Ex.A.1-suit
Pronote for meeting out the urgent expense of school, family expense, and for school administrative expenses in connection with the loan that he
has taken on different dates amounting to Rs. 2,00,000/- and hence, this Court comes to an inevitable conclusion that Ex.A.1-suit Pronote has
been executed by Alexander for Rs. 2,00,000/- in favour of the Respondent/Plaintiff (P.W.1).
35. Coming to the aspect of the Respondent/Plaintiff claiming an interest at 12% per annum for the suit Pronote [Rs.1,60,000/- towards principle
and including interest Rs. 2,00,000/- for which pronote has been executed by Alexander], it is to be pointed out that the Respondent/Plaintiff in her
evidence has not mentioned about the quantum of interest. However, in the Pronote-Ex.A.1 the interest is mentioned as 12%. Insofar as the
evidence of P.W.2 is concerned [witness in Ex.A.1-Pronote dated 15.03.2000], it is to be pointed out that he has specifically stated in his
evidence that Alexander has not informed him anything about the interest and it is his specific evidence that prior to himself and Alexander affixing
their signature in the Pronote, the Pronote-Ex.A.1 has been filled up and that Ex.A.1-Pronote has been executed by Alexander. Even though
P.W.2 in his evidence has deposed that in Ex.A.1-Pronote dated 15.03.2000 Alexander has affixed his signature after reading the same, the fact
that he has deposed that Alexander has not informed him anything about the interest aspect is not a favoubale clear cut evidence in favour of the
Respondent/Plaintiff in regard to the aspect of quantum of interest is concerned. As a matter of fact, the evidence of P.W.2 in regard to the
quantum of interest is not supporting the case of the Respondent/ Plaintiff. In short, the evidence of P.W.2 is not corroborating the evidence of
P.W.1 as to the quantum of interest viz., 12% per annum as mentioned in the Ex.A.1-Pronote.
36. Suffice it for this Court to point out that on an appreciation of the evidence of P.W.1 and P.W.2 coupled with the oral and documentary
evidence on record, this Court comes to an inevitable conclusion that the Ex.A.1-Pronote dated 15.03.2000 has been executed by Alexander for
Rs. 2,00,000/- but since the Respondent/ Plaintiff has not proved to the satisfaction of this Court that Alexander has agreed to pay the interest of
12% per annum to the suit Pronote, this Court, exercising its judicial discretion, awards an interest of 9% per annum from the date of execution of
Pronote viz., 15.03.2000 till date of realisation together with proportionate costs and the two points are answered accordingly and the Appeal is
allowed in part.
37. In the result, the Appeal is allowed in part, leaving the parties to bear their own costs. Consequently, the Judgment and Decree of the trial
Court passed in O.S. No. 95 of 2000 dated 31.01.2002 stands modified. The Appellants/Defendants are directed to pay a sum of Rs. 2,00,000/-
with interest at 9% per annum from the date of Ex.A.1Pronote dated 15.03.2000 till date of realisation together with proportionate costs within a
period of three months from the date of receipt of copy of this Judgment.
