2021 (6) TMI 468 - HC - Indian Laws

Dishonor of Cheque - rebuttal of presumption - Section 118 of Negotiable Instrument Act - HELD THAT - The evidence on record indicates that on 16.06.2001, the plaintiff issued suit notice-Ex. A3. Even though intimation was sent to the appellant, he did not chose to receive the same. The appellant is not an illiterate villager. He is a government servant. He was working as male nursing assistant. He has not chosen to send any communication. If his signatures had been unlawfully obtained by the plaintiff, certainly, the defendant would have issued legal notice to the plaintiff demanding the return of the documents signed by him. It is true that there was a police enquiry. But then, the police complaint was given after filing of the suit filed by the plaintiff. Even if no presumption is drawn in terms of Section 118 of Negotiable Instrument Act, still as rightly held by the Appellate Court, the plaintiff had established the liability on the part of the defendant. Of-course, the defendant had succeeded in obtaining certain answers from the plaintiff during the course of cross-examination which apparently cast a cloud on the case of the plaintiff. When the plaintiff had not chosen to dispute the signatures in Ex. A1 and A2 and when the filing of the suit is preceded by Ex. A3-suit notice, it has to be necessarily held that the plaintiff had established his case against the defendant on a balance of probabilities. Appeal dismissed.

Summary

Issues involved:
1. Appeal against the decision of the trial court dismissing the suit for recovery of a loan amount with interest.
2. Dispute regarding the passing of consideration under the promissory note.
3. Challenge to the first appellate court's decision reversing the trial court's findings on consideration and dismissing the suit.

Issue 1:
The appellant contested the suit claiming he signed blank papers which were later fraudulently filled by the plaintiff to institute the suit. The trial court dismissed the suit, but the first appellate court reversed this decision. The appellant challenged this reversal on the grounds of burden of proof. The appellant argued that the plaintiff failed to prove the appellant signed the promissory note with the intention of acknowledging its terms. The court examined the evidence, including a communication from the finance company, and upheld the first appellate court's decision, finding that the plaintiff had established the liability of the defendant.

Issue 2:
The dispute centered around the passing of consideration under the promissory note. The appellant contended that the loan was for another individual, not himself, and that the plaintiff fraudulently filled in the documents. The court analyzed the evidence, including the loan application and the promissory note, and noted discrepancies in the amount mentioned. Despite the appellant's claims and the absence of account books, the court found that the plaintiff had proven the passing of consideration, even without drawing a presumption under the Negotiable Instruments Act.

Issue 3:
The trial court dismissed the suit based on the lack of proof of consideration, drawing adverse inferences under the Evidence Act. However, the first appellate court reversed this decision without discussing the trial court's findings in detail. The appellant argued that the first appellate court erred in disregarding the trial court's well-considered findings. The court reviewed the case, considering the appellant's defense, the plaintiff's evidence, and the sequence of events leading to the suit. Despite the appellant's contentions, the court found that the plaintiff had established the case against the defendant on a balance of probabilities, leading to the dismissal of the second appeal.

This detailed analysis of the judgment highlights the key legal issues, arguments presented by the parties, and the court's reasoning in reaching its decision.