ABDUL SHAKUR Vs. KOTWALESHWAR PRASAD

JUDGEMENT

(1.) The two questions which have been referred to this Bench for decision are:

(2.) I had the advantage of going through the judgments of my brothers Agarwala and Desai, JJ. On the first question I am inclined to agree with my brother Desai, J. and I would only add a few words.

(3.) Section 118, Negotiable Instruments Act appears in Chapter 13 of the said Act which is headed "Special Rules of Evidence". This, to my mind, means that so far as general rules of evidence are concerned they are abrogated and this chapter should be deemed to be engrafted on the law of evidence so far as negotiable instruments are concerned. There is nothing in the section to suggest that this procedure of proof will apply only between the parties. The presumption mentioned in Section 118 attaches to the instrument because it has been made negotiable and the custom of trade demanded it. The Negotiable Instruments Act, as its preamble shows, was passed with the object of defining and amending the law relating to promissory notes, bills of exchange and cheques. It was not with the object of laying down any procedure relating to mercantile law, but it was the law of promissory notes, and, therefore, wherever that promissory note might be produced, it would go with the qualification as attached to it by the Negotiable Instruments Act. Actually this is not a presumption which had been prescribed by the Negotiable Instruments Act only. Section 114, Evidence Act, Illustration (c) enacts: "A Court may presume a bill of exchange accepted or endorsed, was accepted or endorsed for good consideration." The only difference between Section 114, Evidence Act and Section 118, Negotiable Instruments Act is that while the Evidence Act has used the word "may", Section 118 Negotiable Instruments Act has used the word "shall". The inferences in the illustrations contained in Section 114: Evidence Act include all those natural inferences which the common course of natural events, human conduct and public and private business suggest to us, and if the presumption of consideration in the case of promissory note has been treated as such in Section 114, the Court will ordinarily presume the promisspry note to be for good consideration. The difference, as has been pointed out in Section 4, Evidence Act, between "may presume" and "Shall presume" is that in the former the Court shall regard such fact as proved unless and until it is disproved or may call for proof of it, while in the latter the Court shall presume the fact as proved unless and until it is disproved. Thus, so far as, the right of the other side to disprove is concerned, it is there in both cases. It cannot be doubted that presumption under Section 114 will apply to insolvency proceedings. Even under Section 114, Evidence Act if the Court accepts the promissory note as for consideration no objection could be taken and I can see no reason why this law of Negotiable Instruments Act should be confined only to suits between the parties and should not be made applicable to insolvency proceedings.