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TMI Blog2001 (3) TMI 1081X X X X Extracts X X X X X X X X Extracts X X X X ..... d at Rs. 2,06,985/-. The fourth defendant handed over to the plaintiff a cheque for the said amount drawn on Grindlays Bank, Wellington Island Branch, Cochin duly signed by the second defendant. When the cheque was presented on the request of the fourth defendant during the third week of October. 1985, it was dishonoured. The plaintiff approached the defendants on 15-10-1985 at their shop and informed them about the dishonour of the cheque. But the defendants did not care to settle the account. Hence, the suit was filed for return of the amount. 3. Defendants 1 to 3 filed a joint written statement. According to them, defendants 5 and 6 were not partners of the first defendant-Firm, as they had retired on 31-3-1985. There was absolutely no transaction or dealings between the plaintiff and the first defendant-Firm at any time. Hence there was no necessity or occasion to settle the accounts. No amount was due from the Firm to the plaintiff. The defendants came to know about the cheque only after institution of the suit and on verification from Court. The cheque is devoid of any consideration. The cheque was not issued to the plaintiff for any amount due from the first defendant-Fir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted by any consideration. In December, 1984, the plaintiff gave a loan of Rs. 10,000/-to one Thomas Joseph through the mediation of the fourth defendant. For the confidence of the plaintiff, the fourth defendant had handed over the plaintiff a blank cheque taken from the cheque book of the first defendant-Firm without having any writing except the signature of the second defendant. In order to wreck vengeance against the fourth respondent, that the plaintiff filed the suit. 5. On the basis of the above pleadings, the Court belowraised six issues. Exts. A1 to A18 were marked on the side of the plaintiff, while Exts. B1 to B29 were marked on the side of the defendants. Exts. XI and X2 were marked through witnesses and Ext. C1 is the Court Exhibit. On behalf of the plaintiff, the plaintiff was examined as PW 1 while on behalf of the defendants, the third defendant was examined as DW 1. The second defendant was examined as DW 2. The fourth defendant was examined as DW 3 and one Thomas Joseph was examined as DW 4. 6. On appreciation of the evidence, the Court below found that there was no acceptable evidence to prove that the plaintiff had dealings with the first defendant-Firm an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 9. On behalf of defendants 1, 3 and 5 and 6, it was contended that the slips, Exts. A3 to A15 produced by the plaintiff do not disclose any transaction with the first defendant. According to them, these slips cannot be relied on because they have not been properly proved. Learned counsel submitted that the plaintiffs case cannot be believed, because he has not produced any other document to show that the plaintiff had dealings with the defendants. The defendants gave evidence to show that they did not have any dealings with the plaintiff. So far as the issue of Ext. XI cheque is concerned, it is contended that it was not in the course of the business. It was issued in the name of the plaintiff only because at that time, the plaintiff was employed at Ernakulam. Defendants 5 and 6 further contended that they were not partners of the Firm at the relevant time. On behalf of the fourth defendant, it was contended that the plaintiff had never any transaction with the first defendant Firm. It was contended on behalf of the fourth defendant that the Court below was not correct in granting decree against the fourth defendant. Learned counsel for the fourth defendant highlighted the fac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also to pay sales tax. In these circumstances, it is very difficult for us to accept the argument of the plaintiff that the plaintiff used to supply rubber to the first defendant-Firm. Even though he has stated that previously he had sold rubber, he has not produced evidence to show about such dealings and payment for sale. The only evidence given is that the amount has been received by the plaintiff by Ext. XI and that the cheque is dated 2-8-1976. On the basis of this cheque, the plaintiff contends that this was the amount paid to him by the first defendant-Firm. Ext. XI is a cash cheque for Rs. 3,500/- issued by the first defendant-Firm. The cheque is of the Bank of Baroda, Wellington Island, Cochin. It is seen that this was collected by the State Bank of Travancore. According to the plaintiff, the cheque was given to him and it was collected by him. Ext. X2 shows that there is a credit in the name of the plaintiff for Rs. 3,500/- on 10-8-1976. The answer of the plaintiff is that he was at that time employed at Ernakulam. Hence, the defendants Wanted to cash the cheque through him as otherwise, they will have to send it back by post. In fact, the defendants have produced Ext. B4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elationship proved, it is difficult to assume that the amount which the cheque bears is the amount due by the Firm to the plaintiff. The business transactions do not reveal any connection with the plaintiff and defendants. Hence, the basis of the plaintiffs case that the cheque was issued for the balance payment to the plaintiff on account of the transaction of sale of rubber falls on the ground and hence, according to us, the cheque would have been issued for the amount due to the plaintiff in the transaction of rubber as the transaction was not proved. 14. Learned counsel for the plaintiff then argued that even the case of the fourth defendant is that he had entrusted cheque duly signed by the fourth (defendant) and the fourth defendant was authorised to issue the cheque on behalf of the Firm. He relied on Section 20 of the Negotiable Instruments Act and contended that on the basis of that the defendants are estopped from denying their liability under the cheque. So far as Section 20 of the Negotiable Instruments Act is concerned, according to us, it does not apply because Section 20 applies only with regard to inchoate negotiable instruments. So far as the cheques are concern ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the contesting party has admitted the execution. If such an admission is not there, certainly the effect of that admission can be obtained by the plaintiff if he proves the execution, and in both cases where execution is admitted or proved, a presumption is raised in favour of the consideration having passed. If there is an admission by the defendant, certainly there is no burden on the plaintiff to prove the execution of the promissory note. But, if the plaintiff discharges his burden in regard to the execution of the promissory note then the plaintiff is in the same position where the defendant has admitted the execution of the promissory note and the effect and result is that the burden to prove lack of consideration is then with the defendant. Learned counsel for the plaintiff relied on the decision of the Supreme Court in Bharat Barrel and Drum v. Amin Chand Payrelal (1999) 3 SCC 35 : (AIR 1999 SC 1008), There, the Supreme Court observed as follows : Once execution of the promissory note is admitted, the presumption under Section 118(a) would arise that it is supported by a consideration. Such a presumption is rebuttable. The defendant can prove the non-existence of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decree against the fourth defendant. In the judgment, the Court below has stated as follows : The fourth defendant has no case that Ext. A1 cheque was stolen by the plaintiff from his custody. Therefore if the explanation of the 4th defendant that he had entrusted the blank cheque leal to the plaintiff is disproved, then it is to be held that the 4th defendant had issued the cheque to the plaintiff. If that is the conclusion to be arrived at from the evidence it is clear that the liability under the cheque cannot be that of the 1st defendant firm as the 1st defendant firm had no dealings in rubber with the plaintiff. I have already found that the explanation offered by the 4th defendant as to how the plaintiff got possession of Ext. A1 cheque is unbelievable. Therefore as a natural corollary to that finding it is to be held that 4th defendant had issued Ext. A1 cheque. It is quite clear that he is not deposing the truth before the Court and is setting up a false case in order to avoid the liability . In this context, we would like to refer to the plaint in the case. In paragraph 4 of the plaint, it is stated that a final settlement of accounts was arrived at between the plaintiff ..... X X X X Extracts X X X X X X X X Extracts X X X X
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