2024 (3) TMI 171 - HC - Indian Laws

Suit for recovery of money on the foot of promissory note - Burden/onus to prove - Whether or not the burden is on the plaintiff to prove that the promissory note is given for valid consideration or proving the execution of promissory note is sufficient in view of Section 118 of Negotiable Instruments Act? - burden shifts on the respondent/defendants immediately on plaintiff proving the execution of Promissory Note or not - burden is on the plaintiff to prove the Promissory Note is supported by consideration, while the defendant had admitted the signature contained in Promissory Note in view of Section 101, 102 of Indian Evidence Act or not. HELD THAT - The plaintiff, having prima facie proved to the court that the signatures were those of the defendants by examination of the attesting witnesses, the least that the defendants should have done was take out an application for appointment of an advocate commissioner to take the document to the forensic science laboratory and have obtained a report that the document is an act of forgery and does not contain their signatures. Unfortunately for Mr.N.Subramani, this act has not been done. This will also answer the argument of Mr.N.Subramani that the address of the attesting witnesses had not been mentioned in the document. The basis on which the said acquittal had been rendered, had not been made available to the court. A party relying upon a document must produce the document before the court and the mere fact that they have pleaded in the written statement about its pendency is insufficient for the court to conclude otherwise - the lower appellate court has not even discussed the scope of Section 118 of the Negotiable Instruments Act. In a suit based on the Negotiable Instruments Act, the presumption under Section 118 is a crucial point on law and in fact, not having been referred to, it amounts to the learned Appellate Judge ignoring the vital provisions of law and thus, requires interference. The substantial questions of law are answered in favour of the appellant and against the respondents - Second appeal is allowed.

Summary

Issues Involved:
The judgment involves a second appeal arising from a suit for recovery of money on the basis of a promissory note. The main issues include burden of proof regarding valid consideration for the promissory note, burden shifting to defendants once execution is proved, and the impact of attesting witnesses' testimony on the case.

Issue 1 - Burden of Proof for Promissory Note:
The plaintiff claimed repayment of Rs.31,125 based on a promissory note for marriage expenses. The defendants denied receiving any amount and alleged the promissory note was fabricated. The trial court decreed in favor of the plaintiff, but the appellate court reversed the decision. The appellant argued that once the promissory note's execution is proved, the burden shifts to the defendants to rebut the presumption under Section 118 of the Negotiable Instruments Act.

Issue 2 - Impact of Non-Impleading a Party:
The defendants contended that the non-inclusion of their son as a party was fatal to the case. However, the court noted that this objection was not raised timely and did not affect the court's jurisdiction or the case's merits. Therefore, the argument regarding non-impleading was rejected under Order I Rule 13 of the Code of Civil Procedure.

Issue 3 - Testimony of Attesting Witnesses:
The defendants argued that attesting witnesses testified no money was exchanged, casting doubt on the promissory note's validity. The court clarified that a promissory note does not require attesting witnesses like a bond does. The witnesses' admission of their signatures on the document implied prima facie proof of execution, shifting the burden to the defendants to disprove it under Section 118.

Conclusion:
After thorough consideration, the court found the plaintiff had established the promissory note's execution, and the defendants failed to rebut the presumption under Section 118. The judgment in favor of the plaintiff was reinstated, allowing recovery of the claimed amount with reduced interest. The court highlighted the importance of legal provisions like Section 118 and emphasized the need for proper evidence to challenge the validity of a promissory note. Ultimately, the second appeal was allowed, and costs were awarded to the appellant.