IN THE HIGH COURT OF JUDICATURE OF ANDHRA PRADESH AT HYDERABAD FRIDAY, THE TWENTY FIFTH DAY OF FEBRUARY, TWO THOUSAND AND ELEVEN PRESENT THE HON’BLE SRI JUSTICE N.R.L.NAGESWARA RAO APPEAL SUIT No. 853 OF 2001 BETWEEN: Chekkapalli Vishnu Murthy …APPELLANT AND Vegisetti Venkata Raju …RESPONDENT The Court made the following: THE HON’BLE SRI JUSTICE N.R.L. NAGESWARA RAO APPEAL SUIT No. 853 OF 2001 JUDGMENT: The defendant in O.S.No. 10 of 1999 on the file of Senior Civil Judge, Pithapuram, is the appellant herein. 2. The suit was filed for enforcement of an equitable mortgage. 3. According to the case of the plaintiff, the defendant has borrowed a sum of Rs.1,25,000/- on 12-03-1998 agreeing to repay the same with interest at 18% per annum and thereafter, on 13-03-1998 he has deposited his title deeds with an intention to create an equitable mortgage. Subsequently, on 11-06-1998 a sum of Rs.6,000/- was paid and it was endorsed on the promissory note. Inspite of repeated demands, the defendant did not make any payment and hence the suit for recovery of Rs.1,35,191-20 Ps. 4. The defendant filed written statement denying the execution of the promissory note and the payment and the deposit of the title deeds with an intention to create an equitable mortgage. The substance of the contention of the defendant is that he wanted to sell his properties and he has handed over the original title deeds to the plaintiff and also signed on some blank papers and plaintiff has fabricated the documents and filed the false suit. According to the defendant, he has not received any consideration nor repaid the instalment of Rs.6,000/-. Therefore, the defendant pleaded for the dismissal of the suit. 5. On the basis of the above pleadings, the following issues have been framed by the trial Court, for trial: 1) Whether delivery of the title deeds by the defendant to the plaintiff is not with an intention to create an equitable mortgage but, the documents were delivered to get bargained on percentage? 2) Whether the plaintiff obtained signed blank papers and blank stamped papers from the defendant in the circumstances stated in the written statement? 3) Whether the plaintiff is entitled to the suit claim? 4) Whether the plaintiff has no capacity to lend the amount? 5) To what relief? 6. On behalf of the plaintiff, PWs.1 to 3 were examined and marked Exs.A-1 to A-6. On behalf of the defendant, DW-1 was examined and no document was marked. 7. After considering the evidence on record, the learned Senior Civil Judge, Pithapuram, decreed the suit of the plaintiff. Aggrieved by the said judgment and decree, the present appeal is filed. 8. The points that arise for consideration are: 1) Whether the plaintiff has executed the promissory note and created equitable mortgage? 2) Whether the payment pleaded by the plaintiff is true? 3) Whether the judgment and decree passed by the learned Senior Civil Judge, Pithapuram, is legal and sustainable? 9. POINTS: This being a suit based on a promissory note supported by equitable mortgage, execution of which was denied by the defendant, the burden is on the plaintiff to prove the execution of the promissory note and also passing of the consideration. In support of the proof, apart from examining the plaintiff as PW-1, the attester PW-2 and the scribe PW-3 were examined. As against this evidence, the defendant has gone into box and denied the liability. In this case, the defendant is pleading certain circumstances as to under which he has handed over the title deeds to the plaintiff. According to him, he intended to sell the property and in order to show the title to the prospective purchasers, the plaintiff wanted him to give the title deeds and therefore, he has given the title deeds to the plaintiff and thereby tries to explain the custody of the title deeds with the plaintiff. He also further claims that he has signed on some blank papers on the representation of the plaintiff that he wants to show the receipt for advance paid by the prospective purchasers and therefore, contributed his signatures. It is useful to note that in his evidence he has not specifically denied the signatures on Exs.A-1, A-2 or A-6, which are the relevant documents. On the other hand, in cross-examination, he admits that the signatures on the documents Exs.A-1, A-2 and A-6 appears to be of him. Therefore, it is quite clear that the defendant is not able to explain as to how his signatures came on the stamped receipt Ex.A-1 though it is to be a blank paper. From the evidence of the defendant, he is indebted to others and he was arrested. PW-3, the scribe of the promissory note, has helped him and got him released. Therefore, friendship and association with PW-3 is more rather than the association of PW-3 and the plaintiff for fabricating the document. In fact, in the cross-examination of PW-3, nothing could be made out as to how having helped the defendant in getting him released in execution proceedings would harm the interest of the defendant in fabricating a document. The evidence of PW-1, who is the plaintiff, supported by the evidence of PW-3,clearly establishes the execution of the promissory note Ex.A-1 and also the endorsement under Ex.A-6 made by the defendant. PW-3 is no other than the scribe of the promissory note. I do not find any reason to discredit his testimony and any need for him to fabricate a document against the defendant. 10. It has been strongly contended by the counsel for the appellant that the signature of PW-2 on the promissory note and the endorsement differs from the signatures on the deposition before the Court and therefore, it is a case, where the apparent fabrication is there. I find that the above contention has no force, the promissory note is not a compulsorily attestable document. Assuming to be that the signature on the promissory note was taken later or not done by PW-2, still validity of the document is not defeated as it does not amount to a material alteration of the promissory note. Therefore, the evidence of PWs. 1 and 3 clearly establishes the claim of the plaintiff. The evidence of the defendant that in the presence of one Rama Krishna, he has handed over the title deeds to the plaintiff, is not proved by any acceptable evidence. 11. Further-more when a blank promissory note contains the signature of the defendant and it was handed over to the plaintiff, be authorises him to fill up the contents of it under Section 20 of the Negotiable Instruments Act and the defendant cannot deny the liability. From the evidence on record the defendant is indebted to others and was also in the habit of borrowing rather than selling the property for purchase of other properties. The defendant has at no point of time, has asked for return of the sale deeds prior to the filing of the suit. No prudent man would have kept the title deeds for a longer time on the prospect of the sale to be arranged by the plaintiff. 12. Therefore, from the above circumstances, I have no hesitation in holding that the defendant having received the consideration, executed the promissory note Ex.A-1 and made an endorsement of payment under Ex.A-6 and also deposited the title deeds with an intention to create equitable mortgage and the judgment of the lower Court on this aspect does not call for any interference. 13. However, the counsel for the appellant represents that the defendant is an agriculturist and the subsequent interest granted by the Court at 12% per annum may be considered for reduction by applying Section 34 of the Civil Procedure Code (for short, “the Act”). Though in a suit for mortgage Section 34 of the Act is not applicable, but even under Order 34 of the Act the Court has got discretion to grant such interest after the decree. Taking into consideration the nature of the transaction and the fact that the appellant has already paid half of the decretal amount in pursuance of the directions of this Court, I feel the ends of justice would meet if the subsequent interest is granted at 6% per annum from the date of decree till the date of realisation. With the above modification, the judgment of the lower Court is confirmed. 14. In the result, the appeal is allowed in part and the suit of the plaintiff is decreed with subsequent interest at 6% per annum from the date of decree till the date of realisation. Each party should bear their own costs in this appeal. ________________________ N.R.L.NAGESWARA RAO, J Date: 25-02-2011. INL