L. NARAYANASWAMI Vs. T. KANAGARATHINAM

JUDGEMENT

(1.) THE second defendant in O.S. No. 209 of 1974 in the Court of the Subordinate Judge of Cuddalore is the appellant. The plaintiff filed a suit for recovery of a sum of Rs. 29,301 said to be due on two promissory notes dated 15th April, 1971 and 3rd July, 1971, respectively executed for Rs. 13,001 and Rs. 15,000 carrying interest at 12 per cent. per annum. The said promissory notes were executed in favour of one Nataraja Gramani who assigned them for collection to the plaintiff on 12th March, 1974. The plaintiff is an Advocate practising in Cuddalore. He claimed that there was an endorsement of payment of Rs. 300 on 27th September, 1971 on the promissory note dated 3rd July. 1971, marked as Exhibit A -2. He claimed to have issued a notice subsequent to the assignment in his favour and as there was no reply, he filed the present suit. The first defendant remained ex parte. The second defendant contended that the promissory notes had been concocted with the aid of printed promissory note forms given for a different purpose. According to the second defendant, he and the wife of the first defendant were partners in a firm called Venus Movies and when the firm was functioning in the year 1969, the second defendant alleged that he put his signature on 10 paise revenue stamps affixed to printed promissory notes which were given to the first defendant to be used in case of necessity. The case of the second defendant is that these forms have been used for concocting Exhibits A -1 and A -2. He denied any consideration having passed under these promissory notes and he disputed the plaintiff being an assignee for consideration. There was also a plea of bar of limitation in respect of these promissory notes.

(2.) THE trial Court held that Ex. A -1 promissory note dated 15th April, 1971 could not form the basis of an action as it was barred by limitation. As regards the other promissory note, marked as Ex. A -2, on a consideration of the evidence it was held that the promissory note was true and it had not been prepared under the circumstances alleged by the 2nd defendant. It was also found that the promissory note, Ex. A -2, was supported by consideration and the plaintiff was not a holder in due course, but only an assignee for collection. The result was that the suit was decreed as prayed for with costs and against the 1st defendant and as regards the 2nd defendant he was held to be liable for Rs. 16,600 due under Ex. A -2. It is this decree that is now challenged by the second defendant.

(3.) EX . A -2 promissory note is for a sum of Rs. 15,000/ -carrying interest at 12 per cent per annum. There is a reference to an earlier promissory note executed on 15th April, 1971 for Rs. '13,001 It is stated that the amount due under that promissory note remains unpaid. The promissory note bears three 10 paise revenue stamps. There is a seal affixed on the revenue stamps 'for Venus Movies, Managing Partner". There are two executants. One is Narayanaswami and the other is the 1st defendant, A. Kannan. It is above the signature of A. Kannan "For Venus Movies" appears and he is described by the rubber stamp as Managing Partner. Narayanaswami has signed on one of the revenue stamps and "for Venus Movies" appears in all the three revenue stamps. It is at the back of this promissory note, there is an endorsement of payment of Rs. 300/ - by A. Kannan (1st defendant) on 27th September, 1971. On 12th March, 1974 this promissory note has been endorsed for collection in favour of the plaintiff. The promisee under this promissory note, M. Varadarajan, has signed the endorsement. There are two witnesses. One is named V. Natarajan. There is no address of this person. The other is one Thangavelu of Manjakuppam. He is himself the scribe. The first question is, whether this transaction is hit by Section 136 of the Transfer of Property Act?