HONOURABLE SRI JUSTICE ASHUTOSH MOHUNTA SECOND APPEAL No.1213 OF 2011 DATED 22nd DECEMBER, 2011 BETWEEN Akula Prasad Rao and ors …….Appellants and ChintamaneniSudhakara Rao ……Respondent HONOURABLE SRI JUSTICE ASHUTOSH MOHUNTA SECOND APPEAL No. 1213 OF 2011. JUDGMENT: The respondent herein is the plaintiff in the suit in O.S.No.169 of 2006 on the file of the learned Principal Senior Civil Judge, Eluru, West Godavari District. He filed the aforesaid suit for recovery of Rs.1,11,500/- from the appellants/defendants on the strength of a promissory note. The trial Court through its judgment and decree dated 26.08.2009 dismissed the said suit observing that the defendants are the strangers to the plaintiff and that the suit pronote is not supported by any consideration. Aggrieved by the said judgment and decree, the respondent/plaintiff preferred appeal in A.S.No.99 of 2010 and the learned District Judge, West Godavari District by judgment and decree dated 22.06.2011 allowed the appeal observing that the respondent/plaintiff proved the execution of the suit pronote and as such he is entitled to the suit pronote amount. Being not satisfied with the judgment and decree of the lower appellate Court, the appellants/defendants preferred the present Second Appeal. Heard. Perused the case file. The learned Counsel for the appellants, apart from the substantial questions of law sought to be raised in the memorandum of grounds of this appeal submitted that the respondent/plaintiff failed to prove the execution of the suit pronote. He submitted that the respondent/plaintiff as well as scribe and attestors are strangers to the appellants/defendants. He argued that the lower appellate Court erroneously reversed the finding of the trial Court and as such he prayed that the second appeal be allowed setting aside the judgment and decree of the lower appellate Court by duly confirming the judgment and decree of the trial Court. Per contra, the learned Counsel for the respondent/plaintiff submitted that the appellants/defendants were introduced to his client through his friend. He submitted that the first defendant had admitted his signatures on the suit pronote and as such, the burden on his part stands discharged proving the execution of the suit pronote. He contended that in the absence of any evidence by the appellants/defendants to rebut the presumption as to the execution of the suit pronote for consideration, the findings of the trial Court that the plaintiff failed to prove the execution of the suit pronote is contrary to law. In support of his contentions, he relied on the decision of the Supreme Court in the case of Mallavarapu Kasivisweswara Rao Vs. Thadikonda Ramulu Firm {(2008) 7 SCC 655}. When a promissory note was executed for consideration, the burden initially rests on the plaintiff who has to prove that the promissory note was executed by the defendant. On its proof, the rule of presumption under Section 118(a) of the NI Act would shift the burden to the defendant. The burden of proof being a question of law initially rests therefore on the plaintiff as to the execution of the promissory note and once promissory notie is admitted, section 118 of the NI Act imposes a duty on the Court to raise a presumption in his favour that the said instrument was made for consideration. That presumption shifts the burden of proof namely establishing a case that the promissory is not supported by consideration to the defendant. The defendant may adduce direct or circumstantial evidences to prove that the promissory note was not supported by consideration. If he adduces acceptable evidence, the burden again shifts to the plaintiff. If the circumstances relied on by the defendant are so compelling the burden is on the plaintiff to prove the contra. The statutory presumption though is one of the law is also question of fact to be proved in each case. The presumption raised under Section 118 of the NI Act is not in respect of consideration mentioned in negotiable instruments, the presumption is in the favour of there being a consideration for the negotiable instruments. Any consideration which is a valid consideration in law is valid and enforceable. If a particular consideration mentioned in the negotiable instrument is found to be false and some other consideration is set up, that is a factor which the Court would take into consideration in deciding whether the defendant has discharged the burden cast on him by Section 118 of the NI Act. The Court is required to consider the entire evidence laid before it very often important admissions elicited by counsel for the defendant in the cross- examination of the plaintiff certainly can be availed of by the defendant. The Court therefore must always bear in mind the statutory presumption under Section 118 (a) of the NI Act and also the fact that the burden of proof lies on the defendant and to see whether the burden has been discharged or not. How burden can be discharged or whether it has been discharged is a matter of appreciation of evidence. The failure of the plaintiff to prove a particular consideration may itself probabilise the defendants version and lead to conclusion that there was no consideration at all; on the other hand , it may not have any consideration. (See G.Ramatulasamma Vs.Kogowaraiaha: 1984 (2) ALT 333). If the evidence in the case on hand is tested with the touchstone of the well settled principle of law laid in the aforesaid case, it is clear that the respondent/plaintiff has discharged his burden as discussed below. As can be seen from the record, the respondent/plaintiff categorically deposed that the appellants/defendants received the suit amount on 11.4.2004 and executed the pronote in presence of parties to the lis and P.W.2-attestor. During the course of cross examination, the respondent/plaintiff admitted that the appellants/defendants are residents of Hyderabad and Secunderabad and they were introduced to him through his friend. Similarly, P.W.2, who is the attestor of the suit pronote supported the case of the respondent/plaintiff. In his cross-examination, he also stated that he does not know all the defendants. The appellants/defendants admitted their signatures and contents on the suit pronote. As such it is very obvious that the appellants/defendants have not denied the execution of Ex.A.1 suit pronote. During the cross- examinations of the respondent/defendant and attestor as P.Ws. 1 and 2 respectively, except stating that they don’t know the comprehensive particulars of the appellants/defendants, they could not elicit any information in support of the case of the appellants/defendants, contradicting their case. As such, in as much as the respondent/plaintiff proved the execution of the suit pronote successfully, without there being any doubt, now the burden shifts to the appellants/defendants to rebut the same. The established facts on record would disclose that no rebuttal evidence either oral or documentary was adduced by the appellants/defendants contradicting the stand of the respondent/appellant. As such, they failed to rebut the execution of the suit pronote. The other aspect of the case is that the respondent/plaintiff has filed the suit based on one of the promissory notes furnished by the appellants/defendants to Usha Bala Chit Fund Company relating to chit transaction, which has instituted a suit against them in O.S.No. 531 of 2006 on the file of the IX Junior Civil Judge, City Civil Court, Hyderabad. The trial Court observed that the model of the pronote notes furnished to the said chit fund company and the respondent/plaintiff are entirely different and distinct to each other. The lower appellate Court rightly recorded that the appellants/defendants have not placed any material either before the lower Court or the appellate Court to establish the link between the above suit and Ex.A.1. In that view of the matter the lower appellate Court rightly reversed the judgment of the trial Court. For the foregoing discussion, I do not see any question of law, much less a substantial question of law involved in the Second Appeal warranting interference with the well reasoned judgment of the lower appellate Court in this Second Appeal. The Second Appeal fails and is accordingly dismissed. There shall be no order as to costs. --------------------------------------------- JUSTICE ASHUTOSH MOHUNTA Dated 22nd December, 2011. Msnro