S K SONGAPPA GOUNDER Vs. K P MUTHUSAMY

JUDGEMENT

(1.) S. K. Songappa Gounder, the appellant herein, filed a suit on promissory note for recovery of a sum of Rs. 19,050/- with interest against the defendants. After trial, the suit was decreed only in respect of a sum of Rs. 5,000/- with interest. Challenging the same, the appellant/plaintiff filed an appeal before the lower appellate Court, which in turn dismissed the same. Hence, the Second Appeal.

(2.) According to the appellant/plaintiff, the 1st defendant on behalf of the 2nd defendant borrowed a sum of Rs. 15,000/- from the plaintiff and executed the suit promissory note. In spite of demand through notice dated 29-7-1993, the defendants failed to pay the said sum with interest. Hence, the suit was filed.

(3.) The suit was contested by the defendants by contending that the plaintiff started a chit transaction and the 2nd defendant joined as a subscriber. Every month, he paid Rs. 5,000/- towards chit subscription. The chit auction for the 7th instalment was held on 6-8-1990 and the 2nd defendant was the successful bidder. So, the 1st defendant received the chit amount from the plaintiff and executed the suit promissory note for Rs. 15,000/- on behalf of the 2nd defendant as security for the proper payment of the remaining three instalments. Subsequently, the 2nd defendant paid the 8th and 9th instalments. The last chit subscription was payable on 25-7-1993. Before the 2nd defendant could remit the last instalment and get back the promissory note given as security, the plaintiff issued the notice dated 29-7-1993 demanding the amount mentioned in the suit promissory note. A reply was immediately sent stating that the plaintiff would not be entitled to realise any amount under the promissory note except the last instalment of Rs. 5,000/-.