In the High Court of Judicature at Madras Dated: 12.11.2010 Coram: The Honourable Mr. Justice R.SUBBIAH Second Appeal No.154 of 2002 and C.M.P.No.1187 of 2002 P.Ramasamy ..Appellant/Respondent/ Defendant ..vs.. K.Chinnammal ..Respondent/Appellant/ Plaintiff Second Appeal under section 100 of Civil Procedure Code filed against the judgment and decree dated 13.07.2001 in A.S.No.76 of 2001 on the file of II Additional District Court, Erode, reversing the judgment and decree dated 08.07.1994 in O.S.No.689 of 1992 on the file of I Additional Sub Court, Erode. For Appellant : Mr.V.Bharathidasan For Respondent : Mr.T.P.Manoharan JUDGMENT This second appeal has been filed at the instance of the defendant, challenging the decree and judgment dated 13.07.2001 passed by the learned II Additional District Judge, Erode, in A.S.No.76 of 2001, whereby the decree and judgment dated 08.07.1994 passed by the learned I Additional Subordinate Judge, Erode, in O.S.No.689 of 1992, were set aside. 2. The respondent herein is the plaintiff, who instituted the said suit against the defendant/appellant, for recovery of a sum of Rs.31,920/- with interest stating that on 12.01.1990, the appellant borrowed a sum of Rs.24,000/- from the plaintiff by executing a pronote and also agreeing to repay the same with interest at the rate of 24% per annum. But, in spite of the repeated oral demands made by the plaintiff, the defendant did not repay the loan amount and hence, the plaintiff caused a legal notice on 28.11.1990; but the defendant was evading from paying the said amount on false grounds. Hence, the suit. 3. The case of the plaintiff was resisted by the defendant by filing a written statement and denied the borrowal of the loan amount from the plaintiff, as alleged in the plaint. It was the specific case of the defendant that he never borrowed any amount from the plaintiff and he never executed any pronote and the suit pronote was a forged one. The husband of the plaintiff, viz., Malayappa Gounder lodged a complaint against the defendant before the Sub-Inspector of Police, Kodumudy alleging that the defendant had cheated him and https://hcservices.ecourts.gov.in/hcservices/ pursuant to the said police complaint, the defendant filed a petition for anticipatory bail in C.M.P.No.1549 of 1989; but it was dismissed on the representation made by the police that there was no case pending against the defendant. Since the respondent's husband could not succeed in getting the registration of a criminal case on the basis of the allged complaint made against the defendant, the original suit had been filed with a forged pronote in question. Further, the plaintiff had no means to advance such a huge amount and the defendant did not have any necessity to borrow any amount from the plaintiff. 4. On the basis of the above said pleadings of the parties, the trial court framed three issues for consideration. On the side of the plaintiff, P.Ws.1 and 2 were examined and Exs.A-1 to A-3 were marked and on the side of the defendant, D.Ws.1 and 2 were examined and Exs.B-1 and B-2 were marked. The trial court, on a consideration of the entire evidence on record, both oral and documentary, had dismissed the suit by disbelieving the execution of the pronote marked as Ex.A-1. As against the said judgment of the trial court, the plaintiff filed an appeal in A.S.No.76 of 2001 before the II Additional District Court, Erode. The appeal was allowed by setting aside the decree and judgment of the trial court. Feeling aggrieved by the judgment of the appellate court, the defendant has filed the present second appeal. 5. At the time of admission of the second appeal, this Court framed the following substantial questions of law for consideration: (1) Whether the First Appellate Court has committed an error of law in wrongly placing burden of proof on the appellant ? (2) Whether the First Appellate Court has committed an error of law in decreeing the suit on wrong application of Sections 73 and 45 of the Evidence Act ? (3) Whether the First Appellate Court has committed an error of law in misplacing presumption of Section 118 of the Negotiable Instruments Act when the appellant specifically denied signature in the suit promissory note and passing consideration through promissory note ? 6. Learned counsel for the appellant/defendant would submit that in the written statement, the appellant had specifically denied the borrowal of the loan amount and execution of the pronote. During the trial, on the side of the respondent/plaintiff, the scribe was examined as P.W.2 and on the side of the appellant, one of the attestors to the pronote was examined as D.W.2, who had categorically stated in his evidence that he did not know who had signed on the stamp affixed in the pronote. That piece of the evidence of D.W.2 totally throws the case of the respondent that the appellant had borrowed the amount. Under such circumstances, the respondent ought to have proved the consideration passed under Ex.A-1. Similarly, the respondent had not established her means for advancing the loan amount. Though the respondent had stated in her evidence that earlier https://hcservices.ecourts.gov.in/hcservices/ she had advanced a sum of Rs.24,000/- to one Periyasamy and when Periyasamy returned that amount, the same was advanced to the appellant, she had not chosen to examine the said Periyasamy. Moreover, the trial court had compared the signature found in the pronote with other signatures of the appellant and came to the conclusion that the signatures were not identical and thereby dismissed the suit. But the lower appellate court, though admitted that there were lot of contradictions between the evidence of P.Ws.1 and 2, it had erroneously decreed the suit. Therefore, the judgment and decree of the lower appellate court are liable to be set aside. In support of his submissions, the learned counsel has also relied upon the judgments reported in the case of KUNDAN LAL RALLARAM ..vs.. THE CUSTODIAN, EVACUEE PROPERTY, BOMBAY (AIR 1961 SC 1316), G.VASU .. vs.. SYED YASEEN SIFUDDIN QUADRI (AIR 1987 A.P.139), BHARAT BARREL AND DRUM MFG.CO., ..vs.. AMIN CHAND PAYRELAL (AIR 1999 SC 1008) and CHINNASAMY ..vs.. PERUMAL (2000 (I) CTC 148). 7. Per contra, the learned counsel for the respondent/ plaintiff would submit that though in the written statement it had been stated that there was some enmity between the respondent's husband and the appellant and a complaint was made against the respondent for cheating, in the cross examination, D.W.1(i.e.the appellant) had admitted that there was no enmity between him and the respondent's husband and he did not cheat the husband of the respondent. Thus, by relying upon the said piece of evidence, the learned counsel submitted that when the appellant himself had admitted that there was no enmity between him and the respondent's husband and had not cheated him, the case put forth by the appellant that he had not executed the pronote, cannot be accepted. Moreover, on the side of the respondent, the scribe of Ex.A-1 was examined as P.W.2, who had clearly stated in his evidence that he had prepared Ex.A-1 and the respondent had signed Ex.A-1 in his presence and one Rakkappa Gounder, D.W.2, had signed Ex.A-1 as an attestor. But, P.W.2 was not extensively cross examined by the appellant. Therefore, by examining P.W.2, the respondent had established the execution of the pronote and hence, there was no need to send the pronote for expert's opinion; but the trial court, without properly appreciating these aspects, had dismissed the suit. 8. The learned counsel for the respondent/plaintiff further submitted that the initial burden of proving the case lies upon the respondent/plaintiff and when once the respondent/plaintiff had proved her case, the burden shifts on the appellant/defendant. In the instant case, the respondent had discharged her burden by examining P.W.2, the scribe, With regard to the comparison of the signature, the learned counsel submitted that the Courts can compare the signatures in the pronote only with the admitted signatures of the appellant. In the instant case, the lower court, by comparing the signatures found in the vakalat and Ex.A-1, had come to the conclusion that the signature in Ex.A-1 was not that of the appellant. This method adopted by the trial court for comparing the https://hcservices.ecourts.gov.in/hcservices/ signature in question is patently illegal. In support of his contentions, the learned counsel has relied on the judgments reported in the case of JABIRUNNISA BI ..vs.. KASI NAICKER ((2000) II M.L.J.154), ARUMUGAM, N.S. ..vs.. TRISHUL TRADERS, MADRAS ((2006) 2 M.L.J.41), SOMASUNDARAM ..vs.. PALANI (1999 (III) CTC 156) and CHINNASAMY ..vs.. SIVAGAMIAMMAL (2007(4) CTC 122). 9. By way of reply, the learned counsel for the appellant submitted that the respondent had to establish her case with the cogent and acceptable evidence, but she cannot rely upon the evidence of the appellant to succeed her case. Under such circumstances, the judgment and decree of the trial court are liable to be confirmed. 10. Heard the learned counsel for the parties and perused the materials on record. 11. It is the case of the respondent/plaintiff that the appellant had borrowed a sum of Rs.24,000/- on 12.01.1990 by executing a pronote and on his failure to repay the loan, the respondent had issued a legal notice Ex.A-2 dated 28.11.1990. Per contra, the appellant had denied the borrowal of loan from the respondent as well as the execution of the pronote. It is the specific case of the appellant/defendant that the husband of the respondent lodged a false complaint against him before the police alleging that the appellant had cheated him. Since the respondent's husband could not succeed in the false complaint, by creating a pronote, he filed the present suit and thus, he denied the execution of the pronote. Normally when the execution is proved, Section 118 of the Negotiable Instruments Act imposes a duty on the court to raise a presumption that the consideration has been passed. But, in the instant case, the execution was denied. Therefore, the initial burden lies on the part of the respondent to prove the execution of pronote and passing of the consideration therefor. 12. According to the respondent, when the execution of the pronote can be proved by examining witnesses, then there is no need to send the pronote for the expert's opinion. In support of his contention, the learned counsel for the respondent has relied upon the judgment reported in 2007(4) CTC 122 (supra), wherein it has been held as follows: "6. The learned counsel appearing for the appellant has relied upon the judgment of a Division Bench of this Court reported in D.Pandi v. The Dhanalakshmi Bank Limited, 2001 (2) CTC 12, wherein the bank has filed the suit for recovery of amount on the basis of loan transaction and it was in those circumstances the Trial Court has taken upon itself the responsibility of comparing the disputed signature with that of the admitted signature. On the other hand in the present case, the Trial Court having compared the signature has only said that https://hcservices.ecourts.gov.in/hcservices/ there appears to be slight difference in the signature found place in Ex.A-1 as well as in the written statement. This is not the case of loan transaction and the present case is covered by Negotiable Instruments Act (hereinafter referred to as the Act). The provision of the Act especially under Section 118 imposes the presumption about the validity of the Negotiable Instrument until the contrary is proved by the other side. Inasmuch as the suit promissory note is covered by the said Act, the plaintiff has taken steps to prove the genuineness of Ex.A-1 by examining various witnesses, the question which has to be considered in this case is that whether the defendant has proved the contrary i.e.the said exhibit Ex.A-1 does not contain his signature. It is unfortunate that the learned Trial Judge has found that the plaintiff should have sent the Ex.A-1 for hand writing expert on the basis of Ex.A-4 reply notice where the defendant has denied the signature. On the other hand, a reading of Section 118 of the Act shows that the onus of disproving the claim of the plaintiff is shifted on the defendant and the presumption is always in favour of the instrument. In the present case, as correctly held by the First Appellate Court that nothing prevented the defendant to disprove the claim of the plaintiff by taking steps to send Ex.A-1 to the handwriting expert". 13. Further, the learned counsel has also relied on the decision reported in (2009) 1 M.L.J.979 (supra), it has been held as follows: "It is not necessary in all cases to call for expert's evidence to prove the genuineness of the signature/thumb impression. The plaintiff proved his case by examining himself along with the attestors and the scribe and discharged the burden that was initially on him" 14. Relying upon the said judgments, the learned counsel for the respondent submitted that in the instant case, the scribe, who was examined as P.W.2, had clearly stated in his evidence that the pronote was prepared by him and the appellant had signed the pronote and received amount and one Rakkappa Gounder stood as an attestor. It is the further submission of the learned counsel for the respondent that apart from the evidence of P.W.2, certain admissions were made by D.W.1 in his cross examination that there was no enmity between him and the respondent's husband, which would prove the genuineness of Ex.A-1. On the other hand, it is the submission of the appellant that the attestor, who was examined as D.W.2, had stated in his evidence that @/// vf;$pgpl; v1y; !;lhk;g[ nky; cs;s ifbaGj;J ahUilaJ vd;W bjhpahJ////@ Therefore, according to the appellant, by examining the attestor to the subject pronote, he had proved his case that the pronote was a forged one. Under such circumstances, the liability shifts back to the respondent to prove her case and in the said situation, the respondent ought to have sent the pronote for expert's opinion. https://hcservices.ecourts.gov.in/hcservices/ 15. In this regard, it would be appropriate to go through the decisions relied on by the learned counsel for the appellant and in AIR 1961 SC 1361 (supra), it has been held as follows: "4. To appreciate this argument it would be necessary to notice at the outset the scope of the presumption under Section 118 of the Negotiable Instruments Act and also the different methods available to a person against whom such a presumption is drawn to rebut the same. The relevant part of Section 118 of the Negotiable Instruments Act reads: "Until the contrary is proved, the following presumption shall be made: (a) that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration". 5. This section lays down a special rule of evidence applicable to negotiable instruments. The presumption is one of law and thereunder a court shall presume, inter alia, that the negotiable instrument or the endorsement was made or endorsed for consideration. In effect it throws the burden of proof of failure of consideration on the maker of the note or the endorser, as the case may be. The question is, how the burden can be discharged? The rules of evidence pertaining to burden of proof are embodied in Chapter 7 of the Evidence Act. The phrase “burden of proof” has two meanings — one the burden of proof as a matter of law and pleading and the other the burden of establishing a case; the former is fixed as a question of law on the basis of the pleadings and is unchanged during the entire trial, whereas the latter is not constant but shifts as soon as a party adduces sufficient evidence to raise a presumption in his favour. The evidence required to shift the burden need not necessarily be direct evidence i.e., oral or documentary evidence or admissions made by opposite party; it may comprise circumstantial evidence or presumptions of law or fact. To illustrate how this doctrine works in practice, we may take a suit on a promissory note. Under Section 101 of the Evidence Act, “Whoever desires any court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts, must prove that those facts exist.” Therefore, the burden initially rests on the plaintiff who has to prove that the promissory note was executed by the defendant. As soon as the execution of the promissory note is proved, the rule of presumption laid down https://hcservices.ecourts.gov.in/hcservices/ in Section 118 of the Negotiable Instruments Act helps him to shift the burden to the other side. The burden of proof as a question of law rests, therefore, on the plaintiff; but as soon as the execution is proved, Section 118 of the Negotiable Instruments Act imposes a duty on the court to raise a presumption in his favour that the said instrument was made for consideration. This presumption shifts the burden of proof in the second sense, that is, the burden of establishing a case shifts to the defendant. The defendant may adduce direct evidence to prove that the promissory note was not supported by consideration, and, if he adduced acceptable evidence, the burden again shifts to the plaintiff, and so on. The defendant may also rely upon circumstantial evidence and, if the circumstances so relied upon are compelling, the burden may likewise shift again to the plaintiff. He may also rely upon presumptions of fact, for instance those mentioned in Section 114 and other sections of the Evidence Act. Under Section 114 of the Evidence Act, “The court may presume the existence of any fact which it thinks likely to have happened, regard being had to the common course of natural events, human conduct and public and private business, in their relation to the facts of the particular case”. Illustration (g) to that section shows that the court may presume that evidence which could be and is not produced would, if produced, be unfavourable to the person who withholds it. A plaintiff, who says that he had sold certain goods to the defendant and that a promissory note was executed as consideration for the goods and that he is in possession of the relevant account books to show that he was in possession of the goods sold and that the sale was effected for a particular consideration, should produce the said account books, for he is in possession of the same and the defendant certainly cannot be expected to produce his documents. In those circumstances, if such a relevant evidence is withheld by the plaintiff, Section 114 enables the court to draw a presumption to the effect that, if produced, the said accounts would be unfavourable to the plaintiff. This presumption, if raised by a court, can under certain circumstances rebut the presumption of law raised under Section 118 of the Negotiable Instruments Act. Briefly stated, the burden of proof may be shifted by presumptions of law or fact, and presumptions of law or presumptions of fact may be rebutted not only by direct or circumstantial evidence but also by presumptions of law or fact. We are not concerned here with irrebuttable presumptions of law. 16. In AIR 1999 SC 1008 (supra), it has been held as follows: "12. Upon consideration of various judgments as noted hereinabove, the position of law which emerges is that 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 https://hcservices.ecourts.gov.in/hcservices/ can prove the non-existence of a consideration by raising a probable defence. If the defendant is proved to have discharged the initial onus of proof showing that the existence of consideration was improbable or doubtful or the same was illegal, the onus would shift to the plaintiff who will be obliged to prove it as a matter of fact and upon its failure to prove would disentitle him to the grant of relief on the basis of the negotiable instrument. The burden upon the defendant of proving the non-existence of the consideration can be either direct or by bringing on record the preponderance of probabilities by reference to the circumstances upon which he relies. In such an event, the plaintiff is entitled under law to rely upon all the evidence led in the case including that of the plaintiff as well. In case, where the defendant fails to discharge the initial onus of proof by showing the non- existence of the consideration, the plaintiff would invariably be held entitled to the benefit of presumption arising under Section 118(a) in his favour. The court may not insist upon the defendant to disprove the existence of consideration by leading direct evidence as the existence of negative evidence is neither possible nor contemplated and even if led, is to be seen with a doubt. The bare denial of the passing of the consideration apparently does not appear to be any defence. Something which is probable has to be brought on record for getting the benefit of shifting the onus of proving to the plaintiff. To disprove the presumption, the defendant has to bring on record such facts and circumstances upon consideration of which the court may either believe that the consideration did not exist or its non-existence was so probable that a prudent man would, under the circumstances of the case, shall act upon the plea that it did not exist. We find ourselves in the close proximity of the view expressed by the Full Benches of the Rajasthan High Court and the Andhra Pradesh High Court in this regard. 17. In the head notes of (2006) 2 M.L.J.41 (supra), the decision relied on by the learned counsel for the respondent, it has been stated as follows: "Burden of proving that the promissory note was executed by the defendant, initially lies on the plaintiff - As soon as execution of promissory note is proved, it shifts to the defendant - If the defendant adduces direct evidence to prove that the promissory note was not supported by consideration, burden shifts back to the plaintiff – Trial Court has wrongly thrown the burden of proof on the plaintiff, after the execution was proved – Defendants have not adduced any evidence to prove that the document was not supported by any consideration – Trial Court has wrongly dismissed the suit". 18. A reading of the above judgments would show that it is not necessary in all the cases, the plaintiff is expected to send the https://hcservices.ecourts.gov.in/hcservices/ disputed pronote for expert's opinion and when once the execution is denied by the respondent, the plaintiff is always liable to prove the same through tangible evidence. When the plaintiff proved her case through tangible evidence, the liability shifts to the defendant and after proving the case by the defendant through direct evidence, the liability once again shifts to the plaintiff. In the instant case, by examining the scribe, the respondent/plaintiff had discharged her initial burden. But, subsequently, by examining the attestor to the subject pronote, the appellant had proved his defence. Thereafter, once again the lability shifted on the respondent to prove that the pronote was executed by the appellant, which could be discharged either by adducing further evidence in the manner known to law or by sending the document for the expert's opinion. In the instant case, absolutely, no such effort was taken by the respondent. 19. With regard to the submission made by the learned counsel for the respondent, by relying upon certain contradictions found in the evidence of D.W.1 and the averments in the written statement, I am of the opinion that the plaintiff has to succeed or fail depending upon the materials produced by her and she cannot take advantage of the weakness in the case of the defence if any. This principle was enumerated in the judgment reported in (2001) 1 CTC 148, as follows: "7. ....The fact that he wrote the letter Ex.B-6