DEVUKUTTY AMMA Vs. MADHUSUDANAN NAIR

JUDGEMENT

(1.) DEFENDANTS in a suit for money due under a pro note are the appellants. The suit was filed by the Official Receiver appointed by the Court to manage the assets of M/s. M. N. Venkita Subramannia Iyer & Sons, Bankers, alathur which was adjudicated as insolvent by the Order of the Sub Court, Palghat in I. Ps. 3 and 4 of 1976. The plaintiff alleged that on 5-3-1975 defendants borrowed Rs. 55,335/- from M/s. M. N. Venkita Subramannia Iyer & Sons and executed a pro note, and as collateral security for this debt they mortgaged certain properties by deposit of title deeds. Plaintiff contended that the defendants had not paid any amount towards the liability, and, therefore, the plaintiff after obtaining sanction from the Court filed the suit for realisation of the amount.

(2.) THESE appellants - defendants contended that the suit was not maintainable and the plaintiff was not entitled to file a suit in his capacity as Official Receiver and these defendants had not borrowed any amount from M/s. M. N. Venkita Subrammannia Iyer & Sons on 5-3-1975 as alleged in the plaint. It is contended that deceased Kunhiraman Nambiar, the husband of the first defendant and father of defendants 2 and 3, has some transactions with this banking concern and amounts were due from him at the time of his death. After the death of Kunhiraman Nambiar, these defendants in their capacity as legal representatives had executed pro-notes in favour of the banking concern for amounts due from deceased Kunhiraman Nambiar and the defendants further contended that they believed that the suit promissory note must have been the last pro note executed by them. Defendants denied having handed over the title deeds of their property to the banking concern. The mortgage by deposit of title needs is denied. It was also contended that the suit claim was barred by limitation.

(3.) THE following points arise for consideration; (i)whether the suit pronote is supported by consideration? (ii) Whether there was mortgage by deposit of title deeds? I f so, whether that transaction was invalid for want of registration? (iii) To what reliefs? 3rlqw No. 1 THE counsel for the appellants contended that Ext. A2 pro note is not supported by consideration as these defendants had not received any cash on the date of execution of the pro note. It is argued that even if it is proved that these defendants executed a pro note, it must have been towards the liability of deceased Kunhiraman Nambiar towards M/s. M. N. Venkita Subramanya iyer & Sons and therfore, it is not enforceable under law as it lacked the requisite ingredients as envisaged under S. 25 (3) of the Indian Contract Act. It is proved that the defendants did not receive any cash consideration on the date of execution of the pro note. A summary of the evidence of PW1 on this aspect is that the husband of the first appellant was a big business man in vadakara. He had business transactions with M/s. M. N. Vekita Subramannia Iyer & Sons and Kunhiraman Nambiar died about 20 years back and after Ms death the business collapsed and Ext. A2 pro note was executed as renewal of the debts inclusive of Principal and interest. He further stated that he was not aware of the extent of the Principal and interest. DW 1 also gave evidence and admitted that the second defendant executed Ext. A2 pro note. This is what he has said about Ext. A2: - (Ext. A2 is the pronote we, the defendants, had executed in favour of bankers, M. N. Subrammanian & Sons. Ext. A2 was executed for the amount that was due on the date of that pro note.)