THE HON'BLE SRI JUSTICE K.C.BHANU Second Appeal No.40 OF 2011 JUDGMENT: 1 Aggrieved by the judgment and decree dated 20.10.2010 passed in A.S.No.66 of 2008 by the learned IV Additional District Judge, Kurnool in confirming the judgment and decree dated 02.08.2008 passed in O.S.No.243 of 2006 by the learned Principal Senior Civil Judge, Kurnool. 2 For the sake of convenience, the parties to this Second Appeal will hereinafter be referred to as they are arrayed in the trial court. 3 Brief facts that are necessary for disposal of this Second Appeal are as follows: i. Plaintiff filed the suit against the defendant for recovery of Rs.1,44,914/- with future interest and costs. ii. It is the case of the plaintiff that the defendant on 27.04.1999 had borrowed a sum of Rs.42,000/- from the Plaintiff and had agreed to repay the same with interest at 30% p.a. and executed the suit promissory note in favour of the Plaintiff. iii. Plaintiff further submitted that on 27.11.2000, the defendant made part payment of Rs.5,280/-. The amount under the suit pronote on the said debt was calculated at 24% p.a. for 15 months and that at 30% p.a. for four months and after deducting the part payment of Rs.5,280/-, the total balance arrived at Rs.52,509/- and for this amount, the defendant acknowledged on the suit pronote. Thereafter on 20.11.2003, calculation of the amount at 24% p.a. made and arrived at Rs.90,316/- and on this, the defendant agreed to repay with interest at 24% p.a. and further promissed to pay the said amount in 10 monthly equal installments at RS.10,000/- p.m. and endorsed the same on the pronote. The defendant failed to repay the debt as agreed upon in spite of repeated demands made by the Plaintiff. Then the Plaintiff got issued a legal notice dated 19.06.2006, but the defendant having received the said notice got issued a reply notice dated 24.06.2006 with false allegations. Further the Plaintiff claimed interest at 24% p.a. as promissed. The defendant is not an agriculturist and he is a business man and an income tax assessee and therefore the Plaintiff is entitled to claim contract rate of interest at 24% p.a. Hence the suit. iv. Defendant filed written statement contending inter alia that he never borrowed a sum of Rs.42,000/- from the Plaintiff as alleged, that the suit pronote and the endorsements are forged by the Plaintiff. That the defendant has no necessity to borrow money from the Plaintiff, that the defendant never signed on any endorsements of the suit pronote, that the defendant knows only to speak in Telugu but not reading or writing and that he never undertook to pay the amount in 10 monthly installments at Rs.10,000/- p.m. Further, on receipt of notice dated 19.06.2006 from the Plaintiff, he got issued a reply notice dated 24.6.2006 to furnish a copy of the suit pronote, but the Plaintiff did not furnish the same. The defendant admitted that there were transactions between him and the Plaintiff in respect of purchase of silver and gold. The cheque dt:21.04.2006 was issued in connection with the purchase of silver from the shop of the Plaintiff, that the suit amount claimed by the Plaintiff is not correct, the Plaintiff is not entitled to claim compound rate of interest and prayed to dismiss the suit. 4 Based on the above pleadings, the trial court framed the following issues for trial: i. Whether the suit pronote is genuine and executed by the defendant? ii. Whether the part payment endorsements are genuine? iii. Whether the suit pronote is supported by consideration? iv. Whether the Plaintiff is entitled to claim compound interest? v. To what relief? 5 The Plaintiff himself got examined as P.W.1 and got marked Exs.A1. to A.9. On behalf of the defendant, the defendant himself was examined as D.W.1 but no document was marked. 6 On an analysis of the entire evidence available on record, the trial court came to the conclusion that Ex.A.1 promissory note was executed by the defendant and he also made endorsements as per Exs.A.2 to A.4 on Ex.A.1 and decreed the suit partly for Rs.42,000/- with future interest at 30% p.a. from 27.04.1999 till the date of filing of the suit and thereafter at 6% p.a. till the date of realization after deducting Rs.5,280/- with interest, with proportionate costs and dismissed the rest of the suit claim. On appeal, the learned IV Additional District Judge, Kurnool allowed the appeal partly and decreed the suit for Rs.42,000/- with future interest at 24% p.a. from 27.04.1999 after deducting the part payment of Rs.5,280/- with interest at 24% p.a. from 27.11.2000, with proportionate costs. Challenging the same, the present second appeal is filed. 7 The learned counsel for the appellant/defendant contended that Ex.A.1 is not proved and the admission made by the Plaintiff as P.W.1 would clearly go to show that this is a false case and that the trial court has ignored the opinion of the expert and that Plaintiff failed to discharge his initial burden to show that Ex.A.1 was executed by the defendant himself and hence prayed to admit this Second Appeal. 8 On the other hand, the learned counsel for the respondent/Plaintiff contended that two courts below gave concurrent findings with regard to the execution of Ex.A.1 suit pronote by the defendant and also about the endorsements made by the defendant on Ex.A.1 and that the report of the expert is not marked and the expert is not examined and that the findings of the courts below are based upon proper appreciation of evidence on record and the none of the findings is shown to be perverse or contrary to law and therefore prayed to dismiss the second appeal. 9 The following substantial questions of law are raised by the appellant: i. Whether both the courts below can decree the suit when the pronote under Ex.A.1 is not proved in the manner it has to be proved under N.I. Act as neither scribe nor attestors examined without any proper reason and explanation in not examining them which is very fatal. ii. Whether both the courts below can ignore the crucial admissions of P.W.1 with regard his evidence that defendant had no need to borrow from him etc, and his lapse in non supplying copy of the pronote to the Plaintiff for issuing reply which goes to the route of the matter. iii. Whether both the courts below can form the basis on the sole testimony of P.W.1 with lot of admissions and contradictions without any corroboration with regard to execution of Ex.A.1 pronote and A.2 to A.4 endorsements in the absence of any other independent evidence and in the light of the specific plea of forgery which is fact proved correct with the opinion of the expert. iv. Whether both the courts below can ignore evidence of the expert which is part of the record by simply not considering the same and not making the part of evidence even though document was sent to the expert who gave opinion that Ex.A.1 pronote was forged one. v. Whether the courts below can decree the suit when the respondent/Plaintiff miserably failed to discharge his burden and also failed to prove the Ex.A.1 pronote as required under the N.I. Act. 9 Admission of second appeal is not automatic or in routine manner in view of the amendment to Section 100 C.P.C. The appellant must raise substantial questions of law for admission of the second appeal. Sub-Section 1 of Section 100 CPC declares that an appeal shall lie to High Court from every decree passed in appeal by any court subordinate to the High Court, if the High Court is satisfied that the case involves a substantial question of law. The expression “Substantial question of law” has not been defined in the Code. But it must mean that it should directly and substantially affect the rights of the parties. In other words, it can be said that the question must be debatable, arguable and not free from doubt. If a perverse finding is given or the findings are not based upon any evidence, or inadmissible evidence has been taken into consideration or admissible evidence has been overlooked are some of the questions where the second appeal can be admitted. 10 The initial burden is on the plaintiff to show that the defendant had borrowed the amount covered under Ex.A.1 and he made part payments under Exs.A.2 to A.4. Once execution of Ex.A.1 is admitted, the presumption is that Ex.A.1 was supported by consideration in view of Section 118-A of the Negotiable Instruments Act, 1881. It is in the evidence of P.W.1 that on 27.04.1999 the defendant borrowed a sum of Rs.42,000/- from him and agreed to repay the same with interest at 30% p.a. and executed Ex.A.1 promissory note on the same day and that on 27.11.2000 he made part payment oif Rs.5,280/- and after deducting this, the balance arrived ;at Rs.52,509/- and for that amount the defendant made an endorsement as in Ex.A.2, that on 20.11.2003, the amount due under the suit promissory note was calculated and arrived at Rs.90,316/-, for which the defendant made an endorsement in Ex.A.3, that on 20.11.2003 the defendant endorsed under Ex.A.4 having agreed to repay Rs.90,316/- with interest in 10 monthly equal installments at Rs.10,000/-p.m. As the defendant failed to pay the amount, he got issued Ex.A.5 legal notice dated 19.06.2006, for which the defendant issued a reply under Ex.A.7 with false allegations. As there are no attestors to Ex.A.1, P.W.1 admitted in his cross examination that his brother scribed Exs.A.1 and A.2. In the reply notice, the defendant specifically denied the execution of Exs.A.1 to A.4. Ex.A.9 is the notice got issued by the defendant to the father of the plaintiff whereunder he stated that he had money dealings for the last 16 years with the father of the plaintiff and it is also stated that the father of the plaintiff obtained documents in favour of the plaintiff and his brother P.Mallikarjunappa. So from this admission made in Ex.A.9, it is clear that the suit promissory note Ex.A.1 was executed by the defendant in favour of the plaintiff. On the other hand, D.W1’s case is contrary to the pleading. According to him, he used to purchase gold and silver from the shop of the plaintiff. But in the cross examination, he stated that he never purchased gold and silver ornaments from the shop of the plaintiff. So both the courts below have not placed reliance on the evidence of D.W.1. Therefore, the burden placed on the defendant has not been discharged. No evidence was placed on record to show that Ex.A.1 was not supported by consideration. Therefore, considering these aspects, both the courts below have rightly decreed the suit and those findings need no interference. The said findings of both the courts below are based on proper appreciation of evidence on record and none of the said findings is shown to be perverse. Hence there is no question of law much less any substantial question of law so as to admit this appeal and accordingly the same is liable to be dismissed. 11 At the time of notice before admission of the second appeal, this court directed the defendant to pay 50% of the decretal amount for grant of stay and that order has been complied with by the defendant. Therefore, there are some bonafides on the part of the defendant in paying the decretal amount. The learned counsel for the defendant submitted that if some time is given, the defendant will pay the remaining decreetal amount. Hence four months time is granted to the defendant to pay the remaining decreetal amount at the rate of Rs.18,500/- p.m. However, if for any reason the defendant fails to pay a month’s installment, the plaintiff is at liberty to recover the same through process of law. It is also made clear that on deposit of the amounts by the defendant, the plaintiff is entitled to withdraw the same without furnishing any security. 12 With the above observations, the Second Appeal is dismissed at the stage of admission. No costs. ______________ K.C. BHANU, J 12.09.2011 Kvsn