S. Karunakaran vs S. Ramalingam

P.R. Shivakumar, J.—This appeal has been preferred by the defendant in O.S. No. 11 of 2009 on the file of the Additional District Judge of Puducherry at Karaikal, against the decree of the trial court dated 07.01.2010 passed in the said suit granting the relief sought for by the respondent herein/plaintiff. Ramalingam, the respondent herein filed the above said suit for recovery of a sum of Rs. 1,26,833.35p together with a subsequent interest at the rate of 12% per annum on Rs. 1,00,000/-, being the principal component of the suit claim, from the date of suit till realisation and cost.

The plaint allegations, in short, are as follows:

"The appellant/defendant is a dealer in cement works having his business at various places in Karaikal region. On 23.10.2006, he borrowed a sum of rupees one Lakh from the respondent/plaintiff and executed a promissory note promising to repay the said sum with an interest at the rate of 12% per annum. The consideration for the promissory note was paid in the form of two cheques (a) Cheque No. 535796 drawn on Indian Overseas Bank, Karaikal for Rs. 50,000/- and (b) cheque No. 838452 drawn on Karur Vysya Bank, Karaikal for Rs. 50,000/-. The appellant/defendant encashed both the cheques on the same day. Despite several oral demands made by the respondent/plaintiff for repayment of the said amount, the appellant/defendant did not pay any amount either towards interest or towards principal. Hence the respondent/plaintiff was constrained to issue a notice dated 28.03.2007 calling upon the appellant/defendant to pay the amount due under the Promissory Note. The appellant/defendant who received the said notice did not make payment as demanded and he did not even give a reply. Hence the respondent/plaintiff was forced to file the suit for recovery of the above said amount with subsequent interest with cost as indicated supra.

The suit claim was resisted by the appellant/defendant based on the averments made in the written statement. They are, in brief, as follows:

"The appellant/defendant had no money transaction whatsoever with the respondent/plaintiff at any point of time. In particular, the appellant/defendant did not borrow a sum of Rs. 1,00,000/- on 23.10.2006. He also did not execute any promissory note on 23.10.2006. The actual transaction between the appellant/defendant and the respondent/plaintiff was totally different. The appellant/defendant had taken a house site at Thalatheru Village having an extent of 5400 sq.ft. comprised in R.S. No. 85 Pt. Block No. 06, Ward No. A on lease from the respondent/plaintiff for running a business under the name and style of Raasi Cement Works from 19.08.1996. At that point of time he paid an advance of Rs. 15,000/-. However, the advance amount was subsequently increased to Rs. 1,50,000/-. The lease arrangement was reduced to writing in the form of a lease deed dated 29.05.2003 between the respondent/plaintiff and Arulmozhi, wife of the appellant/defendant. At the time of leasing out the property and even thereafter, the respondent/plaintiff obtained a number of signatures from the appellant/defendant and the appellant/defendant signed those papers according to the direction of the respondent/plaintiff, since he was one of the senior advocates practising in Karaikal. From 1996 to 2007 they maintained a close relationship. The respondent/plaintiff, who did not believe his sons, used the services of the appellant/defendant to go to the bank for encashing the cheques issued by the respondent/plaintiff. On humanitarian grounds, the appellant/defendant helped the respondent/plaintiff by withdrawing money from the bank and giving the same to the respondent/plaintiff. The respondent/plaintiff who wanted to get back the possession of the property leased out to the appellant/defendant, without approaching the proper forum, created the suit promissory note forging the signature of the appellant/defendant in order to intimidate the appellant/defendant to hand over possession of the leasehold property to the respondent/plaintiff, filed the suit as an example of abuse of process of court. When the respondent/plaintiff issued a notice to the wife of the appellant/defendant calling upon her to hand over possession of the above said property after receiving Rs. 1,50,000/- which had been paid by the appellant/defendant as advance, the respondent/plaintiff did not file any suit for eviction and on the other hand, concocting the suit promissory note, he chose to file the suit. Hence the suit should be dismissed with cost."

Based on the pleadings of the parties, the followings issues and an additional issue were framed by the trial court.

Issues:

"1. Whether the defendant has borrowed the amount from the plaintiff and executed the suit promissory note as mentioned by the plaintiff in the plaint?

Whether the plaintiff is entitled to get the decree as prayed for?

To what relief the plaintiff is entitled?"

Additional Issue:

"Whether the signature of the defendant was forged by the plaintiff as stated in the written statement?"

Three witnesses were examined as PWs. 1 to 3 and three documents were marked as Exs. A1 to A3 on the side of the respondent herein/plaintiff. On the side of the appellant herein/defendant one witness was examined as DW1 and one document was marked as Ex. B1. Three documents produced by the witnesses, namely PWs1 and 2, have been marked as Exs. X1 to X3.

At the conclusion of trial, the learned trial judge heard the arguments advanced on both sides and considered the pleadings and evidence. On appreciation of evidence, the learned trial judge held that the suit promissory note produced as Ex. A1 was genuine and it was executed by the appellant herein/defendant after receiving a sum of Rs. 1,00,000/-promising to repay the said amount with an interest at the rate of 12% per annum. Based on the said finding and also the admission that no amount was paid towards the repayment of the said loan, the learned trial judge held that the respondent/plaintiff was entitled to a sum of Rs. 1,26,833.35P being the total amount of principal and interest due as on the date of the plaint, together with an interest on the principal amount at the rate of 12% per annum from the date of plaint till the date of decree and a further interest at the rate of 6% per annum from the date of decree till realisation. The said decree passed by the learned trial judge on 07.01.2010 is challenged in this appeal on various grounds set out in the memorandum of grounds of appeal.

The points that arise for consideration in this appeal are as follows:

"1. Whether the execution of Ex. A1-Promissory Note has been proved by reliable evidence?

Whether the appellant/defendant has proved that the suit promissory note is a forged one?

Whether the suit promissory note is proved to be supported by consideration?

Whether the trial court committed any error in decreeing the suit as prayed for with pendente lite interest at the rate of 12% per annum and post decree interest at the rate of 6% per annum?

To what other relief the parties are entitled?"

The arguments advanced by Mr. Ilanthiraiyan, learned counsel for the appellant and by Mr. S. Sounthar, learned counsel for the respondent were heard. The materials available on record were also perused.

Point Nos. 1 to 3:--

The defendant in the original suit, who suffered a decree for payment of money due under the suit promissory note, has preferred the present appeal. The case of the respondent/plaintiff is simple. According to him he lent a sum of Rs. 1,00,000/- on 23.10.2006 to the appellant/defendant and obtained Ex. A1-Promissory note executed by the appellant/defendant undertaking to repay the said amount with interest at the rate of 12% per annum and that even after several demands and issuance of a notice under Ex. A2 calling upon the appellant/defendant to repay the said amount, he did not comply with the demand. It is an admitted fact that the appellant/defendant is running a business in cement works in the name and style of Raasi Cement Works. The respondent/plaintiff is a practising advocate and a senior citizen aged more than 70 years. According to the respondent/plaintiff, the amount was lent on the basis of the suit promissory note. It is also the case of the respondent/plaintiff that the suit promissory note marked as Ex. A1 was written by the appellant/defendant in his own handwriting.

Though the appellant/defendant after narrating the alleged circumstances under which his signatures were obtained by the respondent/plaintiff at the time of alleged handing over of the leasehold property and later, it is not his case that such papers containing the signatures were used for creation of the suit promissory note. On the other hand, it is his specific plea made in paragraph 6 of the written statement that the suit promissory note was created by forging the signature of the appellant herein/defendant. Since the borrowal as well as execution of Ex. A1-Promissory note has been denied by the appellant/defendant, the initial burden of proving the execution of the promissory note and the borrowal shall be cast on the respondent herein/plaintiff.

In this regard, the respondent/plaintiff as PW1, has deposed in clear terms that on 23.10.2006 the appellant/defendant approached him for a loan of Rs. 1,00,000/- for the improvement of his business and also for the redemption of the jewels belonging to his wife Arulmozhi; that the said amount was paid by him to the appellant/defendant in the form of two cheques, each one for Rs. 50,000/- dated 23.10.2006 and that the said cheques were encashed by the appellant/defendant on the same day. It is also the clear testimony of PW1 (respondent/plaintiff) that the promissory note was written by the appellant/defendant in his own handwriting. It has also been clearly stated by PW1 in his evidence that when he asked the appellant/defendant whether he knew how to write a promissory note, the reply of the appellant/defendant was in the negative and he informed that he would write the promissory note to the dictation of the respondent/plaintiff and that thereafter the contents of the promissory note were written by the appellant/defendant in his own handwriting as dictated by PW1. Of course the evidence of PW1 regarding the alleged lease of 5400 sq.ft. of house site to the appellant/defendant for running his Raasi Cement Works is not clear from ambiguity. For many questions relating to the said lease transaction, PW1 pleaded loss of memory, absence of knowledge and some of the suggestions were denied by him. However PW1 admitted that the appellant/defendant was running a business in the name and style of Raasi Cement Works at Rayampalayam and T.R. Pattinam. So far as the loan transaction under Ex. A1 is concerned, the evidence of PW1 is unambiguous. Besides the clear and unambiguous testimony of PW1, the factum of payment of Rs. 1,00,000/- on the date of Ex. A1-promissory note by way of two cheques stands proved by the examination of PWs2 and 3, the concerned Branch Managers of the banks on which the cheques were drawn and Exs. X1 and X3, the xerox copies of the cheques issued by the respondent/plaintiff in favour of the appellant/defendant and encashed by him on the date of issue itself, namely 23.10.2006. The relevant entries regarding encashment of Ex. X1 is found in the statement of accounts marked as Ex. X2.

On the other hand, the appellant/defendant, who figured as the sole witness (DW1) on this side, simply denied having executed Ex. A1 -Promissory Note. He has also denied the plaintiff''s case that the contents of the promissory note were written by him to the dictation of the respondent/plaintiff. The signature found in Ex. A1-promissory note has been denied by him. The respondent/plaintiff has adduced oral and documentary evidence to the effect that the suit promissory note was written by the appellant/defendant in his own handwriting to the dictation of the respondent/plaintiff. The consideration for the pronote paid by way of two cheques was also proved by the evidence of PWs2 and 3, the bank officials and also Exs. X1 to X3. Such evidence adduced on the side of the respondent/plaintiff was enough to discharge the initial burden cast on him to prove the execution of the promissory note and the fact that it was supported by consideration, so as to cause the shifting of the burden on the appellant/defendant to prove his claim of forgery.

The appellant/defendant who contends that the signature in the suit promissory note had been forged, has not chosen to take steps for having his signature found in Ex. A1-promissory note compared with his admitted signatures by a handwriting expert. The appellant/defendant took a stand that at the time of creation of a lease by the respondent/plaintiff in favour of the wife of the appellant/defendant in the year 1996 itself, the respondent/plaintiff took a number of signatures of the appellant/defendant. But it is not the case of the appellant/defendant that any of those papers containing his signatures was used for creating the suit promissory note or for creating any other document. In the absence of any steps taken by the appellant/defendant, there shall be no impediment for the court to compare the disputed and admitted signatures and arrive at a conclusion.

However, the learned counsel for the appellant/defendant contended that the execution of Ex. A1-Promissory Note was not proved by the respondent/plaintiff and that the finding of the trial court, solely relying on the interested testimony of PW1 disregarding the aspects of ureliability found in his testimony, rendered an erroneous finding to the effect that the execution of the suit promissory note was proved by the respondent/plaintiff. Learned counsel for the appellant/defendant contended further that the trial court ought to have found that the copies of the cheques marked as Exs. X1 and X3 do not contain the signature of the appellant/defendant on their backside and arrived at a conclusion that no consideration was proved to have passed in respect of the suit promissory note and that the passing of consideration was not proved by the respondent/plaintiff.

Per contra, it is the contention of the learned counsel for the respondent/plaintiff that though the signature found in Ex. A1-promissory note is disputed by the appellant/defendant, since evidence was let in by the respondent/plaintiff through PW1 to the effect that Ex. A1-promissory note was written by the appellant/defendant in his own handwriting to the dictation of the respondent/plaintiff and on the other hand, the appellant/defendant did not take any steps to have the disputed writings and the disputed signatures compared with the admitted writings and the admitted signatures, there is nothing wrong in the court itself comparing the disputed signatures found in Ex. A1-Promissory note with the admitted signatures of the appellant/defendant found in the documents that came into existence after the dispute had reached the court. It is the further contention made by the learned counsel for the respondent/plaintiff that the signatures of recent origin and the signatures made after the dispute had reached the court cannot be omitted altogether from consideration, especially when the party trying to prove the disputed signature to be that of the opposite party does not plead that the signatures found in the documents that were brought into existence after the dispute had reached the court were consciously disguised and does not raise an objection for using such signature for comparison with the disputed signature. In support of his contention, learned counsel for the respondent/plaintiff relied on the following judgments:

"1) Kalaimani and Thangaraju Vs. Chinnapaiyan alias Perumal Gounder, (2004) 5 CTC 617 : (2005) 1 MLJ 54 - a judgment of a Division Bench of this court; and

2) Chelladurai Vs. Velmurugan, (2014) 4 CTC 606 : (2014) 5 MLJ 722 "

In Kalaimani''s case, a Division Bench of this court made the following observations:

"In addition to the modes of proving the handwriting as provided by Sections 45 and 47 of the Indian Evidence Act, Section 73 of the Act provides another mode by direct comparison of the disputed signatures or written or finger impression with one, which is admittedly genuine or proved to be so. Section 73 of the Indian Evidence Act enables the Court using its own eyes to compare the disputed signatures with the admitted signatures. It happens not infrequently that in spite of evidence rendered, the Court cannot help comparing handwriting or signature with their own eyes for the proper assessment of the value of the total evidence."

In the said case, the signature of the first defendant therein found in the disputed document was compared with the signatures in his deposition recorded in the court and the signature of the second defendant therein was compared with his signature found in his vakalat. It was contended therein that the signatures of the defendants in the deposition, vakalat and written statement should not be regarded as reliable standard signatures or standard writings for comparison as there was every possibility of the signatures being disguised in order to ensure that the same did not resemble the disputed signatures. However, rejecting the said contentions and holding that those signatures were made spontaneously without any attempt to disguise, the Division Bench held that they were the documents containing standard signatures suitable to be compared with the signatures found in the disputed documents and that the said comparison provided corroboration to the other evidence which were found enough to prove the case of the plaintiff therein.

In Chelladurai''s case decided by myself, the following legal proposition came to be laid down:

"i) In case, a party, whose signature is disputed, wants his own signature found in the documents that came into existence much later in point of time or after the dispute has arisen and the same is opposed by the party relying on the document containing the disputed signature, it shall be prudent for the court not to make such a comparison.

ii) On the other hand, if the person, who relies on the disputed signature, does have no objection for comparing it with, or seeks comparison of the same with, the admitted signature contained in a document even though the same came into existence after the dispute has arisen as he believes that the signatures are not disguised and they are good for comparison, then, the person disputing his signature in the document in question cannot have any valid objection for making such comparison.

iii) Only when the party who relies on the disputed document expresses an apprehension that the document of recent origin or the farthest document shall not be suitable for making comparison, the admitted or proved contemporary signatures alone should be used for such comparison."

In the case on hand, as rightly contended by the learned counsel for the respondent/plaintiff, the signatures found in the vakalat, written statement and deposition of DW1 are admittedly that of the appellant/defendant. If at all there is any possibility of the same being consciously disguised so as to ensure that they do not resemble the disputed signatures found in Ex. A1, it shall be open to the respondent/plaintiff alone to raise an objection regarding the use of said signatures for being compared with the disputed signatures found in Ex. A1-Promissory note. The appellant/defendant cannot be permitted to be raise such an objection for the simple reason that he would not have taken care to make the signatures found in those admitted documents to resemble the disputed signatures, which act, would amount to digging one''s own grave. If the signatures of the appellant/defendant made in the case documents after the dispute reached the court resemble the disputed signatures of the appellant/defendant, the same will show the spontaneity with which and the natural way in which the signatures used for comparison would have been made.

A comparison of the signatures found in the vakalat, written statement and the deposition of DW1 with the disputed signatures found in Ex. A1-Promissory Note will make it obvious that the disputed signatures are that of the appellant/defendant. It is true that the bank officials examined as PWs2 and 3 stated that the payments on the cheques issued in favour of the appellant/defendant were made after obtaining his signature on the backside of the cheques and making him to note his cell phone number also for the purpose of identity. An attempt has been made to contend that the name of the appellant/defendant written on the backside of the cheques, copies of which have been marked as Exs. X1 and X3 are not identical with the disputed signatures found in Ex. A1. The question of comparison of the name of the appellant/defendant written on the backside of the cheques with the disputed signatures found in Ex. A1-promissory note does not arise, since they are not the admitted signatures of the appellant/defendant. Even though DW1 would have stated in his evidence that the cheques issued in his name as bearer''s cheque and encashed through the son of the respondent/plaintiff, who would have written the name of the appellant/defendant and mobile number of some other person projecting it to be the cell phone number of the appellant/defendant, there is no proof of identity of person who received cash payments on those two cheques. The appellant/defendant did not take steps to summon the son of the respondent/plaintiff as a witness to prove the above said contention. A perusal of Exs. X1 to X3 will show that the name of the defendant along with the address and cell phone number was written by the person who received the cash payment on the cheques.

The respondent/plaintiff, who deposed as PW1, asserted in clear terms that the cheques were encashed by the appellant/defendant himself. In this regard, the plea of the appellant/defendant seems to be elusive and ambiguous. The appellant/defendant in his written statement has stated that on several occasions he helped the plaintiff in getting cash from the bank by presenting the cheques issued by the respondent/plaintiff in the name of the appellant/defendant. The respondent/plaintiff emphatically denied having used the services of the appellant/defendant for drawing money from his bank account on any occasion. The appellant/defendant could have summoned those cheques from the bank to prove his contention. However he has not chosen to summon those cheques. He has also failed to call for the account statement to show the entries in proof of his contention. The statement of the bank account of the respondent/plaintiff maintained with the Indian Overseas bank, Karaikal produced as Ex. X2 does not contain any entry showing collection of cash by the appellant/defendant based on any cheque issued by the respondent/plaintiff on any other day, except the cheque dated 23.10.2006 bearing cheque No. 535796, a copy of which has been marked as Ex. X1.

Moreover, the appellant/defendant sets up a motive for the respondent/plaintiff to forge a promissory note and file the suit against him. According to the appellant/defendant, the respondent/plaintiff had leased out a site measuring 5400 sq.ft. to him for the business of the appellant/defendant and received a sum of Rs. 1,50,000/- as advance and instead of taking steps to evict the appellant/defendant following due process of law, the respondent/plaintiff has chosen to fabricate the suit promissory note by forging the signatures of the appellant/defendant and filed the suit. The plea of the respondent/plaintiff, in this regard, is total denial of having let out any property on lease to the appellant/defendant. In order to substantiate the above said contention of the appellant/defendant, Ex. Bl has been produced as the notice issued by the respondent/plaintiff to Mrs. Arulmozhi, the wife of the appellant/defendant. It is dated 30.12.2008 and stated to be issued by one Mr. Narayanan, Advocate, Mayiladuthurai on the instructions of the respondent/plaintiff. There is nothing to show that any reply was sent to the said notice either by Arulmozhi, the wife of the appellant/defendant or by the appellant/defendant. The appellant/defendant, who figured as the sole witness (DW1) on his side, has admitted that no reply to Ex. Bl notice was sent. A consideration of Ex. Bl will make it obvious that the same had been created/arranged by the appellant/defendant himself to be sent to his wife, wrongly projected it to be one issued on behalf of the respondent/plaintiff. Signature of the person instructing the advocate to issue the notice was not obtained in Ex. Bl. Also, the advocate who issued it was not examined as a witness on the side of the appellant/defendant to show that it was the respondent/plaintiff, who caused issuance of the notice. The respondent/plaintiff himself is an advocate having more than 40 years of standing and he himself issued the pre-suit notice in this case, a copy of which has been marked as Ex. A2. As such there was no necessity for him to go over to Mayiladuthurai from Karaikal to cause issuance of Ex. Bl-notice to the wife of the appellant/defendant. The clinching piece of evidence that goes against the appellant/defendant in this regard is the postal receipt attached to Ex. Bl-notice. It is a receipt given in the post office to the sender of the Registered post with acknowledgement due. If it is available with the respondent/plaintiff or with his advocate and produced by them, then it will give rise to an inference that the notice was sent on the instruction of the respondent/plaintiff. It is surprising to note that the said postal receipt has been attached to Ex. Bl-notice allegedly received by the addressee, namely Arulmozhi, the wife of the appellant/defendant. The only inference possible from the same is that the appellant/defendant himself should have caused such a notice to be issued to his wife in the name of the respondent/plaintiff.

Though the appellant/defendant contended that he had no necessity to borrow, he was not in a position to deny a suggestion put to him that he was facing a criminal case in STR No. 1271/2008 on the file of the Judicial Magistrate, Karaikal for the dishonour of a cheque issued by him for a sum of Rs. 4,00,000/- in favour of one Sridharan of Thalatheru. It is also pertinent to note that the appellant/defendant, who admittedly received the notice dated 28.03.2007, a copy of which has been marked as Ex. A2, he did not issue any reply denying the averments made therein. The appellant/defendant did not lodge any complaint with the police. If all the above said aspects are taken into account, it will lead to the inevitable conclusion that by preponderance of probabilities, the case of the respondent/plaintiff regarding his lending a sum of Rs. 1,00,000/- and the appellant/defendant executing Ex. A1-Promissory Note stands proved and that the contrary plea made by the appellant/defendant does not stand substantiated.

Moreover, even if it is assumed for argument sake without admitting that the encashment of the cheques, copies of which have been marked as Exs. X1 and X3 by the appellant/defendant has not been proved, in view of the fact that the execution of Ex. A1-promissory note stands proved by the oral evidence of PW1 and by the fact that the disputed and admitted signatures are found to be that of one and the same person, it will attract the presumption contemplated under Section 118 of the Negotiable Instruments Act, 1881. Hence the plaint averment that the suit promissory note is supported by consideration also stands substantiated. The learned trial judge has not committed any error or mistake in arriving at a conclusion that the borrowal of a sum of Rs. 1,00,000/- and execution of Ex. A1-Promissory note by the appellant/defendant was proved by preponderance of probabilities and that the promissory note was supported by consideration in view of the presumption under Section 118 of the Negotiable Instruments Act, 1881. Hence no ground has been made out for interference with the said findings and on the other hand, the said findings deserve confirmation.

Point Nos. 4 and 5:--

In the foregoing discussions, this court has held that the suit promissory note has been proved to be genuine and that it was supported by consideration. Clear averments have been made and evidence has been adduced to the effect that no amount was paid by the appellant/defendant either towards the repayment of the principal or towards interest. The notice demanding payment was also not responded by a reply containing any averment to the effect that any payment made by the appellant/defendant was not given credit to. It is also not the case of the appellant/defendant that any amount was paid by him towards the discharge of the debt under the suit promissory note marked as Ex. A1.

The respondent/plaintiff claimed an interest at the rate of 12% per annum as per the agreed terms as evidenced by the recitals found in Ex. A1-promissory note. The said interest cannot be said to be either usurious or exorbitant. It is the contention of the respondent/plaintiff that the said amount was paid for improving the business of the appellant/defendant and for redeeming the jewels of the wife of the appellant/defendant. The borrowal being one for the purpose of the business, section 34 of the Code of Civil Procedure permits award of post decree interest more than 6% and not exceeding the contractual rate. Even then, the learned trial judge chose to award pendente lite interest at the contractual rate at 12% per annum and post decree interest at the rate of 6% per annum only. The appellant/defendant cannot have any valid grievance against the award of interest also. Upon a proper appreciation of evidence and application of the correct principles of law, the learned trial judge held the respondent/plaintiff entitled to the amount claimed in the suit and decreed the suit for the amount claimed in the suit with further interest on the principal sum of Rs. 1,00,000/- at the rate of 12% from the date of plaint till the date of decree and post decree interest at the rate of 6% per annum from the date of decree till realisation. The award of cost also cannot be found fault with. This court finds no reason to interfere with the decree of the trial court and the same deserves to be confirmed. There is no merit in the appeal and the same deserves to be dismissed.

In the result, the appeal suit is dismissed with cost confirming the decree of the trial court dated 07.01.2010 made in O.S. No. 11 of 2009. Consequently, the connected miscellaneous petition is closed.