2013 (9) TMI 1279 - HC - Indian Laws

Summary

Issues Involved:
1. Rebuttal of presumption regarding consideration for the promissory note.
2. Burden of proof regarding the signature and assignment of the promissory note.
3. Limitation period for filing the suit.
4. Validity of unstamped documents in judicial proceedings.

Summary:

Issue 1: Rebuttal of Presumption Regarding Consideration for the Promissory Note
The appellant/defendant argued that the suit promissory note was not supported by consideration and presented rebuttal evidence. However, the Courts below held that the respondent/plaintiff's claim was proven, shifting the burden to the appellant/defendant. The appellant/defendant admitted the execution of the promissory note but claimed no consideration was received. The Court found no reason for the appellant to hand over a signed promissory note without receiving consideration and noted the absence of any steps taken by the appellant to retrieve the promissory note or lodge a complaint.

Issue 2: Burden of Proof Regarding the Signature and Assignment of the Promissory Note
The appellant/defendant contended that the respondent/plaintiff did not establish the endorsement of the promissory note by Sundarambal. The Court found that the appellant/defendant admitted her signature on the promissory note but disputed the passing of consideration. The evidence from witnesses (P.W. 2 and P.W. 3) supported the respondent/plaintiff's claim, and the Court held that the burden was rightly shifted to the appellant/defendant to prove the lack of consideration. The Court also found the endorsement valid and sufficient for the made over in favor of the respondent/plaintiff.

Issue 3: Limitation Period for Filing the Suit
The appellant/defendant claimed that the suit was barred by limitation, although this issue was not raised before the trial Court or appellate Court. The Court noted that the suit was filed within the time limit, as the respondent/plaintiff demanded money on 23.1.2004, and the suit was subsequently filed. The plea of limitation was not raised as a substantial question of law, and the Court found no relevance in the appellant's argument regarding limitation.

Issue 4: Validity of Unstamped Documents in Judicial Proceedings
The appellant/defendant argued that Exhibit A-3, an unstamped document, should not be relied upon. The Court held that Exhibit A-3 was marked subject to objection and was an endorsement made by Sundarambal, transferring the right to collect money under the promissory note. The Court found no error in the concurrent finding of the Courts below, holding Exhibit A-3 as a valid endorsement.

Conclusion:
The Court concluded that the appellant/defendant executed the promissory note for valuable consideration and that the respondent/plaintiff, as the holder in due course, was entitled to the suit claim. The substantial questions of law were answered in favor of the respondent/plaintiff, and the second appeal was dismissed.