2014 (10) TMI 1053 - HC - Indian Laws

Dishonor of Cheque - application of presumption laid down in Section 118 of Negotiable Instruments Act when the defendants have completely denied the execution of Ex. B6 - improbabilities of the execution of the transaction referred to in the Ex. A.6 in view of Ex. B.1 - whether the parties have discharged the onus cast upon them in establishing their respective cases? - HELD THAT - The main mortal attack on the plaintiff's case is based on Ex. B.1. According to the learned counsel for the appellants, Ex. B.1 completely consigned Ex. A.6 to the coffin and this had resulted in eclipsing the effect of Section 118 of the Negotiable Instruments Act to Ex. A.6. Expanding his this submission, the learned counsel for the appellants would submit that the alleged old promissory note is dated 15.06.2013, while in his Ex. B.1 letter dated 26.08.2013, just few months after the old promissory note how plaintiff could have been lamented about non-payment of interest and amount for a long period - There was no reference in Ex. B.1 that it has been written in connection with the promissory note debt. Ex. B.1 would not absolve the defendants from their very duty to rebut the presumption arose under Section 118 of the Negotiable Instruments Act. The arising of the presumption under Section 118 of the Negotiable Instruments Act noticed by the First Appellate Court with reference to Ex. A.6 rightly resulted in vacating the judgment and decree of the trial Court and substitution of them with its own judgment and decree, decreeing the suit. Appeal dismissed.

Summary

Issues:
1. Dispute over promissory note and loan repayment.
2. Appeal against trial court's decision.
3. Application of Sections 20 and 118 of the Negotiable Instruments Act.
4. Examination of evidence and legal arguments.

Analysis:
1. The case involved a dispute where the defendants, who lost in the trial court, appealed the decision. The plaintiff sought recovery of a loan amount with interest, alleging non-payment by the defendants.

2. The trial court dismissed the suit based on evidence, including a letter, Ex. B.1, indicating lack of proof of the plaintiff's claim. However, the first appellate court reversed this decision, citing the defendants' admission of signatures and application of Sections 20 and 118 of the Negotiable Instruments Act.

3. The defendants argued against the first appellate court's decision, claiming lack of proof of execution of the promissory note and absence of consideration. They highlighted discrepancies in the plaintiff's case and the stamp paper's date.

4. The judgment analyzed the legal aspects, emphasizing past consideration as valid under Indian law and the authority to fill blank promissory notes under the Negotiable Instruments Act. The court found the plaintiff's evidence and the presumption under Section 118 stronger than the defendants' arguments.

5. The court dismissed the second appeal, upholding the first appellate court's decision and decree in favor of the plaintiff. The defendants were directed to bear their respective costs, and a related miscellaneous petition was also dismissed.