IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE THOMAS P.JOSEPH FRIDAY, THE 8TH JANUARY 2010 / 18TH POUSHA 1931 SA.No. 192 of 1996() -------------------- AS.78/1992 of DISTRICT COURT,THODUPUZHA OS.92/1991 of MUNSIFF COURT, IDUKKI .................... APPELLANT(S)/RESPONDENT/DEFENDANT: -------------- ANANDAN, S/O.NANU, MUTTATHU HOUSE, KEERITHODU KARA, KANJIKUZHI VILLAGE. BY ADV. SRI.T.I.ABDUL SALAM RESPONDENT(S)/APPELLANT/PLAINTIFF: --------------- TULASI, D/O.ANANDAN, KOLATH HOUSE, CHELACHUVADU KARA, KANJIKUZHY VILLAGE. ADV. SRI.S.V.BALAKRISHNA IYER, SENIOR ADVOCATE SRI.P.B.KRISHNAN THIS SECOND APPEAL HAVING BEEN FINALLY HEARD ON 08/01/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: THOMAS P. JOSEPH, J. -------------------------------------- S.A.No.192 of 1996 -------------------------------------- Dated this the 8th day of January, 2010. JUDGMENT The Second Appeal arises from judgment and decree of learned District Judge, Thodupuzha in A.S.No.78 of 1992 granting a decree in favour of respondent for recovery of money with interest in reversal of dismissal of the suit. According to the respondent/plaintiff, appellant/defendant borrowed Rs.3,680/- from her on 21.6.1989 agreeing to repay the same on or before 5.3.1990 and executed demand promissory notice in favour of the respondent on the said day. Respondent demanded repayment of the amount but, appellant evaded her. According to the respondent, she is entitled to recover the sum of Rs.3,680/- with interest at the rate of 6% per annum from the date of suit. She pleaded that cause of action of the suit arose on 21.6.1989, 5.3.1990 and continuously thereafter. Appellant denied the transaction and execution of demand promissory note. He claimed that the document produced along with the plaint is manipulated and at any rate it is not a demand promissory note. Appellant had borrowed Rs.1,000/- from the respondent on 24.5.1988. He repaid Rs.1,700/- on 23.3.1989 which includes interest payable on the principal amount. Respondent demanded a further sum of Rs.300/- which he was not able to oblige. Hence respondent has filed the suit making use of a manipulated document. The document in question was marked as Ext.A1 in the trial court. Respondent gave evidence as PW1. PW2 is said to be a witness to the transaction. Appellant SA No.192/1996 2 gave evidence as DW1 and examined DW2 on his side. Trial court found that Ext.A1 is executed by the appellant but it is insufficiently stamped, that document cannot confer any cause of action for the respondent and accordingly dismissed the suit. In appeal at the instance of the respondent, learned District Judge found that notwithstanding recitals in Ext.A1, it could well be treated as a 'promissory note' as defined in Section 4 of the Negotiable Instruments Act. At any rate, since the respondent has sued on the original cause of action the invalidity if any of Ext.A1 will not prevent the court from granting relief in favour of the respondent. Holding so judgment and decree of the trial court were reversed and decree was granted in favour of the respondent. That is under challenge in this Second Appeal at the instance of the respondent/defendant. Following substantial questions of law are framed for a decision in the Second Appeal: i. Whether the first appellate court was justified in granting relief to the respondent based on the original cause of action? ii. Whether Ext.A1 can be taken as a demand promissory note? It is contended by learned counsel for appellant that the finding entered by the first appellate court is erroneous. SA No.192/1996 3 2. Ext.A1 has been extracted by the learned District Judge in the judgment. Indisputably it contains an unconditional undertaking to pay the amount but not on demand and instead, amount is to be paid on or before 5.3.1990. It also says that in case the amount is not paid it will be open to the respondent to enjoy the property of appellant referred to in Ext.A1 with power of disposal. It is contended by learned counsel for appellant that finding of the first appellate court that Ext.A1 is a demand promissory note is erroneous, going by the tenure of Ext.A1 it is a deed of mortgage and being unregistered cannot be the basis of a decree. Learned counsel for respondent would support the finding of the first appellate court. According to him it is not necessary to go into the nature of the document (Ext.A1) for, the first appellate court has found that suit is based on original cause of action and hence what is required to be considered is only whether that finding of the first appellate court is correct. If the suit is not based on original cause of action and instead based on Ext.A1 then ofcourse the nature and character of Ext.A1 would become relevant for consideration. 3. Even if it is assumed that Ext.A1 is either not a demand promissory note payable on demand and hence not sufficiently stamped or, is a deed of mortgage as pleaded by the appellant, not registered and hence ineffective, a suit on original cause of action would lie. I have gone through the plaint. It is SA No.192/1996 4 stated that appellant borrowed Rs.3,680/- on 21.6.1989 agreeing to repay the same on or before 5.3.1990 and executed a demand promissory note in favour of the respondent. First appellate court is therefore justified in observing that execution of the document was after the transaction. In paragraph 7 of the plaint it is stated that cause of action for the suit arose on 21.6.1989 (date of transaction) and 5.3.1990 (by which day the appellant was to repay the amount) and continuously thereafter (when appellant failed to pay the amount). Going through the plaint I am unable to say that the suit is based on Ext.A1. On the other hand it is seen that the suit is based on the original cause of action, ie. lending and borrowel of the amount with liability to repay the amount on or before 5.3.1990. That being so, the suit does not suffer from any invalidity whatever be the nature and character of Ext.A1. PWs 1 and 2 have given evidence regarding the transaction. It is true that contra evidence is given by DWs 1 and 2. First appellate court has for cogent reasons rejected the evidence of DWs 1 and 2 and accepted the evidence of PWs 1 and 2. Ext.A1 has been marked in evidence without any objection as seen from the deposition of PW1. Therefore notwithstanding whether Ext.A1 is a promissory note payable otherwise on demand or whether it is a deed of mortgage as contended by the appellant the same can be used for collateral purposes. Ext.A1 also states about the transaction and it corroborates the evidence of PWs 1 and 2. SA No.192/1996 5 In the circumstances first appellate court is justified in holding that respondent is entitled to succeed on the original cause of action notwithstanding the nature of Ext.A1. Substantial question of law framed in that regard is answered accordingly. In the above circumstances it is unnecessary to go into the nature of Ext.A1. 4. The claim of interest is only from the date of suit which the court is entitled to award under Section 34 of the Code of Civil Procedure. Resultantly the Second Appeal fails and it is dismissed with cost to the respondent. I.A.No.526 of 1996 will stand dismissed. THOMAS P.JOSEPH, Judge. cks SA No.192/1996 6 Thomas P.Joseph, J. S.A.No.192 of 1996 JUDGMENT 8th January, 2010.