S.K. ABDUL AZIZ Versus MAHMOODUL HASSAN

This is a suit for recovery of Rs.2,40,000 under Order XXXVII, C.P.C.

2. Case of the plaintiff is that he had sold his poultry farm to the defendants by registered sale‑deed for Rs.20,00,000. As the defendants were short of funds, therefore, they requested the plaintiff for a loan of Rs.2,40,000. The plaintiff keeping in view the urgency of the defendants advanced them a sum of Rs.2,40,000 as a friendly loan which was required by the defendants for their overhead expenses. The defendants executed a pronote and a receipt dated 1‑2‑1982 for the same amount. The plaintiff demanded back the said amount time and again but the defendants refused to return the same on one or other pretext. The plaintiff sent a legal notice to the defendants through his Advocate on 3‑12‑1983, but without any success. Hence this suit.

3. The defendants have contested the suit and have filed written statement wherein they have admitted to have purchased the poultry farm of the plaintiff for Rs.20,00,000 but have denied that they were short of funds or had requested for a loan of Rs.2,40,000 from the plaintiff. They have alleged that at the time of the execution of registered sale‑deed for purchase of the poultry farm on 11‑2‑1982 they had paid Rs.20,00,000 to the plaintiff as mentioned in detail in the sale‑deed. On the same day the plaintiff had also sold his poultry birds, Suzuki van and other items to the defendants but the price of the same could not be settled. The defendants had given this pronote of Rs.2,40,000 to the plaintiff as a security for the price of the birds etc. Thereafter, on 28‑5‑1983 an agreement of final settlement was entered into by the parties wherein the cost of all the birds, Suzuki van and other items was assessed at Rs.2,48,044. After adjusting a sum of Rs.1,01,730 already paid by the defendant there was a balance of Rs.1,46,314 which was rounded to the figure of Rs.1,46,000 and was agreed to be paid by the defendants in easy instalments of Rs.5,000 per month. At the time of execution of the aforesaid final agreement the defendants had demanded back the pronote and the receipt in suit from the plaintiff but he misrepresented to the defendants that the same were misplaced. Consequently a clause was inserted in the agreement to the effect that all agreements, receipts, pro‑notes etc. or any other documents showing any liability in respect of the said transaction executed by the parties in favour of each other were thereby cancelled and were to be of no legal effect of whatsoever nature against each other thenceforth. The plaintiff had filed a suit for the recovery of Rs.11,46,000 referred to above being Suit No.136 of 1984 which was decreed on the admission of the defendants and the defendants are paying that decretal amount in instalments.

4. On the pleadings of the parties following issues were framed:

(1) Whether the defendants borrowed a sum of Rs.2,40,000 from the plaintiff on 1‑2‑1982 to meet the overhead expenses?

(2) Whether the defendants executed a promissory note and receipt on 1‑2‑1982 for Rs.2,40,000?

(3) Whether the defendant No.l executed the agreement dated 28‑5‑1983 in lieu of Promissory Note dated 1‑2‑1982?

(4) Whether the plaintiff changed the date of the Promissory Note and receipt from 11‑2‑1982 to 1‑2‑1982?

(5) Whether the plaintiff is entitled to recover a sum of RS.2,40,O00 from the defendants?

(6) Whether the claim of the plaintiff is false and frivolous and as such both the defendants are entitled to claim special costs u/s 35‑A, CPC?

(7) What should the decree be? My findings on these issues are as follows:‑

(1) As follows.

(2) Yes.

(3) Yes.

(4) As follows.

(5) No.

(6) No.

(7) Suit dismissed with no order as to costs.

REASONS

ISSUES NOS. 1 TO 7

For the sake of convenience I propose to take up all the issues together.

5. On 25‑2‑1987 the suit was fixed for evidence. The plaintiff and his Advocate were present at 10‑00 a.m. while there was no appearance for the defendants. Hence the plaintiff was called upon to file his affidavit in proof of his claim. Consequently he filed the affidavit at 12.00 noon. By that time M/s. Shaikh Mohammad Usman and Zaheer Hussain, Advocates appeared for the defendants and requested that they may be allowed to cross‑examine the plaintiff on the affidavit already filed by him. They however, did not insist on the re‑examination‑in‑chief of the plaintiff in Court.

They confronted the plaintiff with following documents: (i) Exh. 5/1 receipt for Rs.12,60,000 dated 11‑2‑1982, (ii) Exh. 5/2 receipt for Rs.1,40,000, Rs.5,000 and Rs.1,35,000 dated 11‑2‑1982, (iii) Exh. 5/3 agreement dated 17‑5‑1983. On being asked by the defendants' counsel the plaintiff produced Exh. 5/4 certificate of withdrawal of Rs .1,18, 810.01 dated 4‑3‑1987.

The plaintiff produced following documents in support of his evidence: (i) Exh. 5/5 interim guarantee executed by the plaintiff in favour of I.D.B.P., (ii) Exh. 5/6 and Exh. 5/7 the receipt and pronote in suit (iii) Exh. 5/8 the duplicate of Exh. 5/3, dated 28‑5‑1983, (iv) Exhs. 5/9 to 5/12 notices exhanged between the Advocates of the parties.

6. As against this the defendant examined himself and produced Exh. 6/1 Special Power of Attorney, Exh. 6/2 Registered Sale‑Deed of the poultry farm, Exh. 613 true copy of the plaint in Suit No.136 of 1984, Exh. 6/4 agreement of sale of the poultry farm.

7. The plaintiff has stated on oath that the defendant had executed the pronote Exh. 5/7 and the receipt Exh. 5/6 on 1‑2‑1982. He has not claimed that the entire consideration of the pronote and receipt was paid to the defendant then the there. In fact he is not clear on this point. He has taken inconsistent and confusing stands. The plaintiff has put forth various versions as to the consideration of the pronote and receipt of Rs.2,40,000 on the basis of which he has filed this suit. His stand, taken in notice Exh.5/9 is that defendant had taken a friendly loan of Rs.2,40,000 and executed the pronote and receipt. Thereafter, in the plaint, it is stated that he had sold his poultry farm to the defendant for Rs.20,00,000 but as the defendant was short of funds therefore he advanced a sum of Rs.2,40,000 to him sis a friendly loan and got pronote and receipt executed from him, after taking payment of only Rs.18,60,000. In this affidavit of evidence he has stated that the defendant had taken this loan from him for purchase of stamps and other overhead expenses as the I.D.B.P. on behalf to the defendant had agreed to pay him only Rs.18,60,000 and thus a sum of Rs.1,40,000 remained to be paid to the plaintiff because the deal for the poultry farm was settled at Rs.20,00,000. The amount of Rs.1,00,000 was for stamps and other overhead expenses while the amount of Rs.1,40,000 was the balance of amount that would have been still due after receipt of money from I.D.B.P. In his cross‑examination he has admitted that he had paid Rs.1,00,000 not by cheque but in cash to the defendant after withdrawing it from National Bank. He has not produced the statement of account showing that he has withdrawn the sum of Rs.1,00,000 from the bank on or before 1‑2‑1982 but has produced a certificate Exh. 5/4 which shows that he had in all withdrawn Rs.1,18,800 from his two accounts during the month of January 1982. He has stated in his cross‑examination that these withdrawals were made on more than, one dates and thus the contention of the plaintiff that he paid Rs.1,00,000 in cash to the defendant does not appear to be believable. Similarly his allegation that Rs.1,40,000 were to be paid by I.D.B.P. to the defendant and that the I.D.B.P. has actually paid the said amount to the defendant as was admitted by him is also not believable. No documentary evidence whatsoever has been led in proof of the payment of Rs.1,40,000 by I . D . B . P. to the defendant although the same must be there. The suppression of that evidence also goes against the plaintiff. The notice Exh. 5/9 does not specify that only Rs.1,00,000 were taken as a loan and that the remaining Rs.1,40,000 were paid by I.D.B.P. to the defendant. The reply of the defendant to the said notice Exh. 5/11 is emphatic and clear denial of the loan. I am, therefore, satisfied that from the evidence on the record the payment of consideration of the pronote and receipt Exh. 5/7 and 5/6 has been disproved.

8. There is yet another aspect of this case which goes in favour of the defendant. It is Exh. 5/3 dated 28‑5‑1983. Para 5 of this agreement reads as under:‑

"5. That all agreements, receipts, Promissory Notes etc. etc. or any other document showing any liabilities in respect of the said transaction executed by the parties in favour of each other are hereby cancelled and are of no legal effect of whatsoever nature against each other henceforth."

The plaintiff admits to have executed this agreement. He has also himself produced its duplicate as Exh.5/8. He has also admitted its contents to be correct. The only explanation given by him to para 5 is that in fact there were two separate transactions, one was for the plot of poultry farm and the other was for the birds and other articles of the poultry farm. This para related to the transaction with regard to the birds and other articles of the poultry farm and not with regard to the plot of poultry farm. As against this the defendant has stated that the para referred to all receipts, pronotes and documents showing any liability in respect of the transaction which covered the plot of the poultry farm as well as the birds and other articles thereof which were in fact one transaction and it is incorrect to suggest that there were two separate transactions or that the agreement related only to the portion of the transaction. I also do not find any merit in the contention of the plaintiff and agree with the defendant that para 5 makes it quite clear that the parties had agreed that all the receipts and pronotes or any other documents showing any liability in respect of the transaction relating to the poultry farm as a whole comprising of its plot, birds and articles executed by the parties in favour of each other were thereby cancelled and were of no legal effect of whatsoever nature against each other thereafter. It is precisely on this ground that this Court had granted unconditional leave to defend to the defendant and the said order was maintained in appeal.

9. The advocate for the plaintiff contended that the defendant had admitted the execution of the pronote as well as receipt. Hence a presumption had arisen under Section. 118 . (a) of Negotiable Instruments Act in favour of the plaintiff about the consideration. A The burden to show that in fact no consideration passed would heavily lie on the defendant. In this connection he has relied upon the following cases:‑

(1) AIR 1960 Orissa 172 (Bishnu Dayal Junjhunwalla v. Atal Behari Acharya).

(2) AIR 1932 All. 164 (Jagmohan Misir v. Mendhari Dube).

(3) AIR 1960 Punjab 500 (Chandan Lai Joura v. Amin Chand Mohan Lal).

(4) AIR 1935 All 154 (L.Ram Nath v. Lala Ram Chandra Mal).

(5) AIR 1919 Oudh 16 (Thakur Din v. Oudh Commercial Bank).

(6) 193 I.C. 863 (Rishi Kesh v. Brij Mohan Lai).

There can be no cavil with the proposition of law put forth by the plaintiff but it is to be seen as to how the defendant can discharge the burden of proof placed upon him. Non‑payment of consideration is a negative fact. There can be some cases in which it may not be possible for a defendant to lead evidence as to non‑payment of the consideration. In view of this he can definitely rely upon the facts and circumstances of the case and can also refer to the flaws in the evidence of the plaintiff and can then contend that the presumption has been rebutted. If the plaintiff goes into witness‑box and the Court after considering his evidence comes to the conclusion that consideration has not passed it can hold that the defendant has discharged the burden. Similar situation had arisen in the case of Chandan Lai Joura v. Amin Chand Mohan Lai reported in AIR 1960 Punjab 500 referred to by the plaintiff himself and similar view was taken by that Court. In AIR 1960 Orissa 172 Bishnu DayalJunjhunwalla v. Atal Behari Acharya the Court on consideration of evidence held that even after giving full weight to the presumption in favour of the holder of the handnote, the evidence on record clearly showed that the handnote was not executed for consideration.

Hence as already held by me on the basis of the evidence that has come on record it is proved that the defendant did not receive separate consideration of the pronote and the receipt and that both these pronote and receipt were cancelled by subsequent agreement.

10. It was contended by the counsel for the defendant that the plaintiff was not allowed to set up at the hearing an entirely new and inconsistent case vis‑a‑vis what has been stated in his plaint. Reliance in this connection was placed on P L D 1986 (SC) AJK 109 (Qurban Hussain v. Bashir Begum) and 1987 C L C 157 (Mst. Akhtari' Begum v. Muhammad Qasim). In both these rulings it was held that no evidence can be led or looked into in support of pleas which were not taken in the pleadings.

11. I am, therefore, of the clear view that the plaintiff has failed to substantiate his case. Hence I dismiss the suit. Looking to the special circumstances of this case I leave the parties to bear their own costs.

M.B.A/S‑134/K Suit dismissed.