MADASU GANESWARA RAO Vs. PASUPULETI SUBBA RAO

JUDGEMENT

(1.) The unsuccessful plaintiff in both the courts below is the appellant and the respondents are the defendants in the suit. The appellant-plaintiff instituted a suit O.S.No.38 of 1979 on the file of the I Additional District Munsif, Tanuku for recovery of Rs.3,446-36 ps being the Principal and interest due on a promissory note dt. 31-5-1976 executed by the respondent-defendants in favour of the transferor of the appellant-plaintiff for a consideration of Rs.3,000.00 payable with interest thereon.

(2.) The case as pleaded in the plaint is that the defendants borrowed Rs.3,000.00 from one K. Suryanarayana Raju undertaking to repay the same with interest thereon and executed a promissory note on 31-5-1976 and the said Suryanarayana Raju transferred the suit promissory note on 20-8-1976 receiving a sum of Rs.3,000.00 in favour of the present plaintiff, the appellant in the Second Appeal and inspite of repeated demands, the respondents-defendants did not pay the same and it was also pleaded that the respondents-defendants are not entitled to the benefits of the A.P. Agriculturists Debt Relief Act (Act IV of 1938) and also the A.P. Agricultural Indebtedness (Relief) Act, 1977. The respondents-defendants no doubt had taken a stand that they did not borrow the amount from the transferor of the plaintiff and the first defendant borrowed Rs.1,000.00 prior to 31-5-1976 from Ananda Raju and he had obtained promissory note from both the defendants and the suit promissory note is a renewal of earlier promissory note and an amount of Rs.1500.00 was added in the suit promissory note and Ananda Raju obtained suit promissory note in the name of the plaintiff's transferor. It was also further pleaded that the plaintiff's transferor is not a small farmer and the promissory note was transferred in favour of the plaintiff only with a view to overcome the provisions of the A.P. Agriculturists indebtedness Relief Act (Act 7 of 1977). On the strength of the said pleadings, the following issues were settled:

(3.) The Court of the first instance had recorded the evidence of P.W.I to P.W.3 and D.W.I to D.W.3 and Exs.A-1 to A-4 marked and on appreciation of oral and documentary evidence on issue No.l, it was held that the suit promissory note is true, valid and binding on the defendants. However, on issue No.2 it was held, the transfer was made with a view to circumvent or evade the provisions of Act 7 of 1977 and hence the transfer endorsement is not true, valid and binding on the defendants and while answering issue No.3 it was held that in as much as the provisions of Act 7 of 1977 are applicable to the defendants, they are entitled to the benefits of the said Act and hence the plaintiff in the suit is not entitled to recover the suit amount.