FA/430/1984 1/9 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD FIRST APPEAL No. 430 of 1984 For Approval and Signature: HONOURABLE MR.JUSTICE P.B.MAJMUDAR ====================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ====================================== MINAXIBEN WD/O.CHIMANLAL HARJIVANDAS AND ANOTHER Versus RAJNIKANT MOHANLAL SHAH ====================================== Appearance : MR VC DESAI for Appellants. NOTICE SERVED for Respondent. ====================================== CORAM : HONOURABLE MR.JUSTICE P.B.MAJMUDAR Date : 07/09/2006 ORAL JUDGMENT The appellants herein are the original defendants, against whom the respondent herein had filed a suit being Civil Suit No.3839/1980 for recovering Rs.41,418.75 ps., as principal amount plus Rs.17,364.25 ps., as interest, as well as notice charge at Rs.150/-. Accordingly, the plaintiff has filed aforesaid suit for recovering Rs.58,933/- along with future FA/430/1984 2/9 JUDGMENT interest and cost of the suit. The case of the plaintiff is that the plaintiff is doing business of cloth on wholesale basis in the city of Ahmedabad. According to the plaintiff, defendant No.2 was carrying on his business of wire and hardware in the name of defendant No.1. It is the case of the plaintiff that during Sanvat year 2031, i.e., in the year 1975, he and defendant No.2 opened mutual and current account in connection with their money dealings and those transactions were of Sharafi account and it was agreed between them to pay interest over the same at the rate of 12% per annum, and that defendant No.2 was advanced certain loans under this account and he had also passed certain receipts in connection with some of the transactions. Such transactions continued between plaintiff and defendant No.2 during Sanvat year 2031, 2032 and 2033. In Sanvat year 2034, defendant No.2 took a money loan of Rs.15,000/- from the plaintiff on 25-11-1977 and also a loan of Rs.50,000/- on 10-12-1977 for which receipts were also passed by defendant No.2 in favour of the plaintiff. After making payment of Rs.15,000/- by three cheques of Rs.5,000/- each, defendant No.2 stopped making further payment. Thereafter, defendant No.2 changed the name of his business from Gujarat Steel Traders to Bharat Wire Traders and the stock of Gujarat Steel Traders was transferred and kept in the premises of partnership business carried out in the name of Gujarat Hardware . It is the case of the plaintiff that defendant No.2 was evading payment, therefore, the plaintiff served defendant with notice dated 25-11-1980 and demanded the amount but defendant did not comply with the same. Therefore, the plaintiff filed aforesaid suit to recover aforesaid amount. By filing said suit, the plaintiff prayed for decree of Rs.58,933/- along with future interest. Defendant resisted the said suit by filing FA/430/1984 3/9 JUDGMENT written statement Exh.24 and denied the claim of the plaintiff. Defendant No.2 admitted the fact that he was carrying the business of wire and hardware in the name of defendant No.1 – Gujarat Steel Traders as its sole proprietor. However, they denied that at present defendant No.2 is carrying on business in the said premises in the name of Bombay Wire Traders. According to defendant No.2, he was in financial difficulty in his business, therefore, he was compelled to stop his business with effect from 21-1-1978. Other creditors of defendant No.2 have also filed the suit for recovery of dues and prohibitory orders over the goods kept in the premises of defendant No.1 were obtained. It is also the case of the defendants that defendant No.2 has executed writings on 26-1-1978 with previous dates and the plaintiff assured that the amount due from him to defendant No2, which would be saved thereby would be paid afterwards. According to defendant No.2, the plaintiff wanted to take undue advantage of the said writings. It is the case of the defendants that the plaintiff has abused the trust deposed on him by executing two writings, which were executed under the circumstances explained by the defendants, for which there was no consideration and such writing is illegal and inoperative. The defendants accordingly denied the claim of the plaintiff on this and other averments made in the written statement. Thereafter, after considering the oral and documentary evidence, learned trial Judge has framed various issues at Exh.31. After considering the oral and documentary evidence, learned trial Judge came to the conclusion that the plaintiff has proved his case and accordingly decreed the suit with interest by judgement and decree dated 29th April, 1983. Being aggrieved by the said decree, the original defendants have FA/430/1984 4/9 JUDGMENT preferred this First Appeal under Section 96 of the Civil Procedure Code. I have heard Mr.Desai, learned advocate for the appellants and I have also gone through the record and proceedings of the case. It is not in dispute that the plaintiff was carrying on business of cloth on wholesale basis in Ahmedabad city and in Sanvat year 2018 in Sakar Bazar and was also doing business of Sharafi transactions from that area. Defendant No.2 was carrying his business of wire and hardware in the name of defendant No.1. It has come in evidence that defendant No.2 and plaintiff knew each other very well and they were having very good relations. It has also come in evidence that between defendant No.1 and plaintiff, there were business relations and there were business transactions between them. It has also come in evidence that defendant No.1 had taken loans from various traders and bankers and he had taken deposits from various depositors but defendant No.2 suffered financial setback in the business, which was carried out by him in the name of defendant No.1 and, ultimately, in January 1978, he closed his business and went underground for some time. He thereafter conducted meetings with his creditors but he was unable to pay his entire liability. His business was also sealed in connection with suit filed by one bank, namely, Madhavpura Cooperative Bank. Defendant No.2 paid the debts of some of his creditors, but it was not possible for him to satisfy the debts of all his creditors. The plaintiff, in his evidence, has narrated the transactions carried out with defendant No.2. The plaintiff has clearly stated in his evidence that defendant No.2 opened mutual account and current account in connection with money dealings as the transactions were of Sharafi account. The plaintiff has also produced cashbook and ledger account, which are at Exh.48 to 54 and Exh.44 to 47 respectively. In these ledgers, accounts of defendant No.2 are at page FA/430/1984 5/9 JUDGMENT Nos.16, 11, 8 and 13 respectively. As per the evidence, during Sanvat year 2032, defendant No.1 was given loan of Rs.12,000/- by three cheques and at the end of that year and after adjusting the account and other previous dues, amount of Rs.7725/- has remained as credit to defendant. He also gave explanations as to why no interest was added to the said amount. The amount of Rs.7725/- was carried forward to next year, i.e., Sanvat year 2033. During Sanvat year 2033, defendant No.1 was given loan of Rs.24,500/- by three installments and in Sanvat year 2034, plaintiff advanced loan of Rs.15,000/- to defendant No.1 on Kartik Sud 15, and Rs.50,000/- on Kartik Vad 30 and defendant No.1 paid Rs.15,000/- by three cheques of Rs.5,000/- each. The plaintiff in his evidence has accordingly explained the outstanding amount of Rs.41,418.75 ps., which was due and payable by the defendants at the end of that year, i.e., Sanvat year 2034. Case of the plaintiff could not be dislodged by the defendants in any manner. The receipts executed by the defendants are also produced on record at Exhs.56 and 57. The plaintiff has also denied the suggestion of the defendant that amount of Rs.27,225/- was due from him to the defendants at the end of Sanvat year 2034. Plaintiff also examined witness No.2 – Bhupendra and said witness has stated that plaintiff is his maternal uncle and he know defendant No.2 since last seven to eight years. He has also supported the case of the plaintiff regarding outstanding dues. The plaintiff has also examined other two witnesses in order to prove his claim. Defendant No.2 in his evidence has stated that after the money dealings between him and plaintiff, they used to tally the transactions, which they had at the end of the year and he used to furnish the plaintiff with the statements of account and that there was no agreement to pay interest between them. In his evidence, he has stated that he is maintaining the books of accounts regularly. According to FA/430/1984 6/9 JUDGMENT defendant No.2, he used to receive the amount by cheques and not by cash. According to him, he has also paid the amount of Rs.4500/- by cheque on 2-11-1976. He has denied the claim of the plaintiff, as according to him, he has not received any cash amount from the plaintiff. Considering the evidence on record, it is an admitted fact that there were some money transactions between the parties regarding their business between Sanvat year 2031 and 2032. Even in his cross-examination, defendant No.2 has admitted that the amount, which he has paid back to the plaintiff during Sanvat year 2031 and 2032 in cash for that he did not insist for any receipt from the plaintiff. In my view, learned trial Judge has rightly appreciated the evidence by coming to the conclusion that the plaintiff has proved his case. The plaintiff is able to explain the disputed entry in respect of Rs.225/- on which the defendant tried to rely heavily that said entry was not genuine. On the other hand, defendant has not produced his books of accounts of Sanvat year 2031 and 2032 and therefore adverse inference was required to be drawn against him. Learned trial Judge has rightly found that explanation given by defendant No.2 in not producing books of accounts is highly unsatisfactory and his say cannot be accepted. Considering the evidence on record, as a whole, trial Court is perfectly justified in coming to the conclusion that defendant No.2 has intentionally suppressed those books of account by not producing the same on record. It is required to be noted that oral evidence of the plaintiff is also corroborated by the documentary evidence in the form of books of accounts coupled with the fact that plaintiff has examined other FA/430/1984 7/9 JUDGMENT witnesses to prove his case. Learned trial Judge has also properly dealt with this aspect in para 29 of the judgement. It is required to be noted that the evidence of the plaintiff is also further corroborated by two receipts issued by defendant No.1 pertaining to the amount in question. The books of account regarding subsequent two years produced by defendant No.2 is highly doubtful. The plaintiff has seriously challenged the genuineness of these books of accounts. Therefore, learned trial Judge has rightly found that said books of accounts are highly unreliable and doubtful. In paragraph 39, learned trial Judge has dealt with the said aspect in great detail. It is found that books of accounts produced by defendant No.2 are not at all reliable and they do not appear to have been maintained in regular course of business. Many entries are not carried forward and some pencil entries are made. Even after the defendant closed his business, there are some entries in the books of accounts showing that the business was carried on. The defendants have miserably failed to make out their case that receipts at Exh.56 and 57 were not issued by him, which are dated 25-11-1977 and 10-12-1977 respectively. Learned trial Judge has made certain observations with regard to these two receipts in paragraph 31 of his judgement : “Similarly the explanation offered by the defendant no.2 pertaining to the two receipts of the aforesaid amounts is neither reasonable nor plausible but palpably a false one. These two receipts exhs.56 and 57 bear the dates of 25.11.1977 and 10.12.19777 and they were written by the defendant no.2 in his own hand-writings and he signed the same. More over receipt exh.56 is one the printed letter-head of defendant no.1 concern Gujarat Steel Traders. While the receipt exh.57 is ordinary piece of paper, but below the signature of defendant no.2, there is the rubber stamp of defendant no.1 concerned and he signed the same FA/430/1984 8/9 JUDGMENT as the Proprietor of it after affixing revenue stamp of ten paise over it. So these facts would go to show that both these receipts were written and signed by not on same day, but on different days. Even the instrument and ink used for writing these two receipts differ, as the writings of the receipt exh.56 are with dark blue ink and letters or words are thick, while in the receipt exh.57, the ink used is light blue and letters or words are thin. If both these receipts were written at a time on subsequent date i.e. on 26.1.1978, then pieces of paper would not be different and both of them would be on the printed letter-head of defendant no.1 concern, and both of them would bear revenue stamps and rubber stamps would be used in both of them and that would be written with same instrument and same quality of ink. So the above pertinent facts go to show that the version of defendant no.2 pertaining to these receipts cannot be accepted at is face value that he passed these two receipts on different dates on same day i.e. on 26.1.1978.” Learned trial Judge has also discussed in detail the disputed entries in paragraph 35 of his judgement. After considering the totality of documentary as well as oral evidence, in my view, learned trial Judge has not committed any error in appreciating the evidence. The money transactions between the parties are amply proved by the evidence on record. The plaintiff's version is probable and acceptable then the say of defendant No.2, especially, when the evidence of the plaintiff is corroborated by books of accounts as well as other oral evidence on record. Mr.Desai, learned advocate for the appellants is not in a position to attack the evidence of the plaintiff in any manner nor he is in a FA/430/1984 9/9 JUDGMENT position to support the say of the original defendants. In my view, learned trial Judge was perfectly justified in decreeing the suit on appreciating the evidence as well as in granting running interest at the rate of 12% per annum as claimed by the plaintiff. Considering the aforesaid aspect of the matter and considering the oral and documentary evidence on record, it can be said that the plaintiff has proved his case and the decree was rightly passed in favour of the plaintiff by the trail Court. Accordingly, trial Court has rightly arrived at the finding of fact by properly appreciating the evidence on record and the defendants have failed to make out their case and they were unable to dislodge the evidence produced by the plaintiff. In that view of the matter, I do not find any substance in this appeal, hence, this Appeal is dismissed with no order as to costs. Record and proceedings to be sent back. (P.B.Majmudar, J.) /malek