Skip to content


Gopala Padayachi and ors. Vs. Rajagopal Naidu - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtChennai
Decided On
Reported inAIR1926Mad1148
AppellantGopala Padayachi and ors.
RespondentRajagopal Naidu
Cases ReferredJagan Prasad v. Indar Mal
Excerpt:
- .....as to the admissibility of ex. b the lower court has, as pointed out, rejected it as a promissory note, but admitted it as an acknowledgment of the debt in ex. a. it is pointed out by the plaintiff that under section 36 of the indian stamp act this court cannot go behind the decision of the lower court in a matter of; this kind. this section has been interpreted in many cases as of a mandatory nature and as applying also to a court of appeal or revision, independently of the fact whether the admissibility was challenged in the lower court or not, and i must hold that it precludes this court from interfering with the decision of the lower court on this matter.6. the case in venkatarama iyer v. chella pillai : air1921mad413 is no doubt a case in which the objection was not taken before.....
Judgment:

Wallace, J.

1. This Civil Revision Petition is against the judgment and decree of the lower Court in Small Cause suit. The suit was inter alia for money due on a promissory note in the following circumstances: On 8th November 1921 the first defendant executed a promissory note, Ex. A, to one Subba Nayakar. On 30th October 1924 Rs. 235 was due on this note. For this amount the 1st defendant executed a fresh promissory note, Ex. B, in favour of the same promisse. Both the notes have been transferred to the plaintiff.

2. The main point in the case was whether Ex. B was enforceable as a promissory note. It is admittedly insufficiently stamped under the amended Stamp Act, as it bears only an one-anna stamp. The lower Court, however, has admitted it in evidence as an acknowledgment of the debt in Ex. A, for which purpose it is sufficiently stamped, has held that it serves to keep the debt alive, and has given judgment for the sum claimed. The defendants put in this Civil Revision Petition and contend that the lower Court has erred in law in holding this view.

3. Three main contentions have been argued before me: (1) that Ex. B was inadmissible for any purpose, (2) that even assuming that it is admissible as an acknowledgment of the debts in Ex. A, that debt has been discharged and therefore no claim can be founded on it; and (3) that even taking the Subordinate Judge's view that the suit can be founded on the debt in Ex. A, the amount decreed is too large. A subsidiary contention of Defendants Nos. 2 and 3 who are sons of the 1st defendant is that they are not liable for the debt as it was not for family purposes.

4. The last contention may be shortly dismissed. The Defendant No. 2 was ex parte in the suit; the Defendant No. 3, a minor, represented by the Defendant No. 1 did not raise the point in his written statement or challenge the plaintiff's claim that the money was borrowed by the Defendant No. 1 as manager for family purposes, and the point was not pressed before the lower Court. Clearly it cannot be taken here. It raises matters of fact of which the plaintiff was never put to proof.

5. As to the admissibility of Ex. B the lower Court has, as pointed out, rejected it as a promissory note, but admitted it as an acknowledgment of the debt in Ex. A. It is pointed out by the plaintiff that under Section 36 of the Indian Stamp Act this Court cannot go behind the decision of the lower Court in a matter of; this kind. This section has been interpreted in many cases as of a mandatory nature and as applying also to a Court of appeal or revision, independently of the fact whether the admissibility was challenged in the lower Court or not, and I must hold that it precludes this Court from interfering with the decision of the lower Court on this matter.

6. The case in Venkatarama Iyer v. Chella Pillai : AIR1921Mad413 is no doubt a case in which the objection was not taken before the first Court; but the rulings in Ramasami v. Ramasami [1882] 5 Mad. 220 Devachand v. Hirachand Kumarai [1889] 13 Bom. 449; and Nagappa Chettiar v. V.A.A.R. A.I.R. 1925 Mad. 1215; are cases where objection was taken at the beginning. I am not at present prepared to go further and admit the respondent's contention that, once it has been admitted, it can be used for any purpose. These are remarks no doubt in 13 Bom 449 which might go to support that contention; but it may be pointed out that in that case, although the first Court had admitted the documents as bonds, the lower appellate Court admitted them as promissory notes, and therefore the High Court was precluded by Section 36 from questioning their admissibility as promissory notes. I take it that this Court is not bound under Section 36 to admit the document any further or for any other purposes, than the lower Court has admitted it.

7. The lower Court has clearly admitted it only as an acknowledgment of the debt in Ex. A. It has not been admitted, and cannot be admitted, here as an acknowledgment of the debt set out in itself; i. e., it is not admissible as an ackdowledgment of any independent contemporaneous debt. As a promise to pay, constituting a contractual obligation to pay the debt set out in it, it is not admissible and has not been admitted. On the second point, the question is whether the debt in Ex. A. is a subsisting debt, or does it stand discharged or is it, even though it purports to have been discharged, revived because of the invalidity and unenforceability of Ex. B? I am not fortunately hampered in this case by the circumstances of third party's, possibly endorsee's, interests, since the plaintiff is the transferee of both notes.

Now, Ex. B recites:

I have settled at Rs. 285 the amount due for principal and interest under the promissory note executed by me in your favour on the 8th November 1921 and have executed this for Rs. 285 in full satisfaction thereof

and the contemporaneous endorsement on Ex. A is:

For the sum of (Rs. 285) two hundred and l eighty-five due for principal and interest under this note another note has been executed on. the said date. The amount due having been thus paid off, this note has become discharged.

8. On 30th November 1925 there follows another endorsement on Ex. A.

As I understand that the note which was executed in renewal hereof and endorsed to you is not valid, you...are to receive from Gopal Padayachi the aforesaid amount due under this note.

9. It will be observed that Ex. A was retained with the promisee even after Ex. B was taken, and was transferred by him later on to the plaintiff. The real point is: Did the parties intend that Ex. A should be finally 'discharged, or was the discharge contingent on Ex. B being enforceable? This was really a question of fact into which the lower Court should have gone fully if the point had been clearly raised before it; but probably it was not clearly raised there. But having regard to the fact that the endorsement on Ex. A clearly sets out that in substitution of it Ex. B was taken and that the amount due on Ex. A has been 'thus paid off,' and that Ex. A was retained with the promisee and not returned to the promisor, and having regard also to the inherent improbability that the plaintiff intended to discharge Ex. A whether or no Ex. B was enforceable, I think it must be held that the parties only intended that Ex. A should be considered as discharged if Ex. A was enforceable.

10. The law on this subject has been lucidly discussed in Chockalingam Chetty v. Annamalai Chetty [1916] 34 I.C. 417. It has there been laid dcwa following Raman v. Vairavan [1884] 7 Mad. 392 the principle of which has also been endorsed by the Privy Council in Mt. Raheswari Kuar v. Rai Balakrishnan [1886] 14 I.A. 142 and by the Bombay High Court in Krishnaji v. Rajmal [1900] 24 Bom. 360, that when a promissory note is taken for a contemporaneous debt, the balance of opinion is that the execution of the promissory note does not discharged the debt, but only suspends the creditor's ordinary remedy on the debt during the currency of the promissory note, and that when the promissory note is taken for an antecedent debt, the authority is overwhelming that the promissory note operates only as a suspension of the ordinary remedy until it matures or is enforced. If then the promissory note is unenforceable in law, the ordinary remedy on the original debt is revived and is enforceable provided it is not barred by limitation. This is clearly laid down in Anantanarayana, Iyer v. Savitri Ammal [1912] 36 Mad. 151; Natarajulu Naicker v. Subramanian Chettiar A.I.R. 1922 Mad. 181; Jagan Prasad v. Indar Mal [1914] 36 All 259.

11. In this view therefore the debt under Ex. A is enforceable provided it is not barred by limitation, and the question remains whether Ex. B is a valid acknowledgment of that debt sufficient to save limitation.

12. In my view, Ex. B clearly admits and acknowledges the indebtedness under Ex. A, and that this indebtedness is not' discharged otherwise than by the execution of Ex. B in its place. The promisor in effect says:

I acknowledge the amount under Ex. A as due from me to you and to enable you to recover it from me I give you Ex. B.

13. Though Ex. B now proves useless for that purpose, the aknowiedgment of the debt under Ex. A remains and is in my view, sufficient acknowledgment within the meaning of Section 19 of the Indian Limitation Act to save limitation. The lower Court's view on this point is therefore correct.

14. Following that view, however, it ought to have based its decree on the amount due under Ex. A whereas it has given a decree on the amount claimed in the plaint which is based on the footing of Ex. B being a valid promissory note. I understand the difference comes to about Rs. 10. The decree amount will therefore have to be reduced by this amount.

15. With this difference the decree of the lower Court is confirmed and the revision petition dismissed with costs.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //