2020 (9) TMI 104 - HC - Indian Laws

Dishonor of Cheque - Section 138 of Negotiable Instruments Act - suit for recovery of money with interest and costs - whether the plaintiff is entitled to decree as prayed for? - HELD THAT - This Court is of the considered opinion that the plaintiff has established the fact that the defendant has admitted that he has issued a cheque for ₹ 17 lakhs. The cheque was presented by the plaintiff for encashment and was returned with an endorsement that the defendant has issued a 'stop payment' instruction. On verification, the plaintiff came to understand that sufficient funds were not available in the accounts of the defendant. This being the facts which are all admitted between the parties and in respect of other contention, there must be a proof to establish the same. In the absence of any clinching evidence, to disprove the said basic facts, the Trial Court has rightly proceeded with a finding that the plaintiff is entitled for the relief of recovery of money. On perusal of the entire findings, arrived by the Trial Court, which is in consonance with the document and evidence, this Court is of the opinion that there is no perversity or infirmity as such so as to interfere with the findings of the Trial Court - Appeal dismissed.

Summary

Issues Involved:
1. Whether the suit cheque was issued by the defendant in discharge of debt?
2. Whether the plaintiff is entitled to decree as prayed for?
3. Whether the plaintiff is entitled to claim interest and costs?

Issue-wise Detailed Analysis:

1. Whether the suit cheque was issued by the defendant in discharge of debt?

The plaintiff contended that the defendant borrowed ?17,00,000 and issued a cheque, which was dishonored due to "payment stopped" instructions. The defendant argued that the cheque was issued as a loan to the plaintiff, who failed to provide a promissory note and title deeds as security. The Trial Court examined the documents and evidence, concluding that the cheque was issued in discharge of debt despite the defendant's claims. The defendant's inability to prove the letter dated 03.03.2003 and the lack of sufficient funds in his account further weakened his defense. The Trial Court determined that the plaintiff could take advantage of the presumption under the Negotiable Instruments Act that the cheque was issued in discharge of debt.

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

The Trial Court framed issues to determine if the plaintiff was entitled to the decree. The plaintiff established that the cheque was issued for repayment of debt, and the defendant's defense was not supported by sufficient evidence. The court found the plaintiff's claims credible, noting the defendant's failure to prove his version of events. The Trial Court held that the plaintiff was entitled to the decree, as the evidence supported the claim that the cheque was issued in discharge of debt.

3. Whether the plaintiff is entitled to claim interest and costs?

The Trial Court awarded the plaintiff interest at the rate of 6% from the date of the suit till the date of decree and thereafter at the same rate till realization on the sum of ?17,00,000, along with proportionate costs. The court found that the plaintiff was entitled to these amounts due to the defendant's failure to repay the debt.

Conclusion:

The High Court confirmed the Trial Court's judgment and decree, finding no perversity or infirmity in the findings. The appeal was dismissed, and the plaintiff was granted the relief of recovery of money with interest and costs. The court emphasized the importance of sufficient evidence to support claims and defenses in legal disputes.