SUDARSAN TRADING COMPANY Vs. V. SANKAR

JUDGEMENT

(1.) The appellant is the plaintiff in O.S. 56/72 on the file of the Munsiff Court, Payyannur. The suit was for recovery of a sum of Rs. 4,215 alleged to be the balance principal and interest due on a promissory note.

(2.) Appellant plaintiff is a company registered under the Indian Companies Act. The first respondent joined a kuri conducted by the plaintiff company at Payyannur Branch. On the 5th instalment, the first defendant bid the kuri and received the price amount on 13th August 1969. At that time as security for future subscriptions to the kuri, the defendants executed a surety and security proposal form on 30th June 1969 as per Ext. A-1. On 13th August 1969, a pronote Ext. A-2 for Rs. 4,400 was executed as security for the future instalments due from the first defendant to the company. Second defendant stood as surety. According to the plaintiff after the execution of the promissory note the first defendant had made payments of Rs. 750 which is inclusive of the dividends upto 8th February, 1972. The amount due from 14th instalment is kept due. A notice was issued demanding the defendants to pay the entire balance amount as per Ext. A-7 on 20th September 1971. In the plaint it had been stated that title deeds deposited in the Cannanore Branch by the second defendant over properties allotted to her share in partition amounts to a mortgage by a deposit of title deeds. The plaintiff sought realisation of the amount concerned personally from the defendants and also by sale of the property mortgaged.

(3.) In the joint written statement filed by the defendants, it is admitted that the first defendant joined the kuri and bid the same. But the payment of consideration of Rs. 4,400 under Ext. A-2 had been denied. According to them there was no payment on the date of Ext. A-2, and only Rs. 3,735 had been paid to the first defendant by cheque to a Bank in Cannanore and the Payyannur Court before which the suit was filed had no jurisdiction to entertain the matter. It is stated that the second defendant was an unnecessary party to the suit and only the first defendant who received the consideration was liable. It is also asserted therein that some amounts that had been paid had not been credited in the plaint. According to them the total amount discharged by the first defendant was Rs. 1,440. It is also contended that the first defendant was entitled to a dividend which comes to Rs. 1,265. A contention has also been taken that the legal requirements for the creation of mortgage by deposit of title deeds have not been complied with in the case and the suit on the basis of mortgage is not maintainable.