(1.) The plaintiff sues as holder in due course to recover from the defendants the maker and the first holder of a promissory-note payable thirty days after sight, made on the 20th of March I9:12. A decree has been already obtained against the first defendant Ramkisson who was the first holder. The plaintiff new sues the maker Nagindas Ranchhoddas on his note.
(2.) The defence is that Ramkisson obtained the note for unlawful consideration and therefore it lies upon the plaintiff to prove that he gave consideration for it before he can enforce his remedies as a holder in due course.
(3.) The fist question to be answered, then, is whether as (Jetwfcen Nagindas Ranchhoddas and Ramkisson the latter sxtorted the note of the 20th of March from the former so that in law whatever consideration might be said to have been given for it was an unlawful consideration. Upon this point share is (only the evidence of the defendant Nagindas himself. His story m that inconsequence of a suit against him by one Nanalal decided in March 1912, he applied to the firm of Belasirai. & Cp., to whom he had given a great number of promissory notes signed in blank, for the return of those notes. Ramkisson, representing the firm of Belasirai & Co., insisted is a condition of returning those signed blank notes that Nagindas should execute this promissory-note for Rs. 2,500 payable thirty days after date and a further note of hand for Rs. 1,200 (with which I have at present nothing to do) and should farther give a letter of acknowledgment to the firm of Belasirai & Co., admitting his indebtedness of this promissory note and three others of like amount and the note of hand for Rs. 1,200. Thus on the 20th of March 1912 the defendant Stagiridas executed the promissory-note which is the subject-matter of this suit in favour of Belasirai & Co., and he also wrote the letter dated the and of March, Ex. 2 in this case,. If this story be true, then first turning to the definition of... " consideration" in the Contrast Act, and next to what is- defined to be "lawful consideration" and applying those definitions to Section 118 of the Negotiable Instruments Act, the Court would have no doubt in holding that the defendant Nagindagi. had made good the first step of his-defence for the only consideration moving from Belasirai & Co. to the defendant Nagindas for this note would be the restoration of about 75,000. worth of promissory notes signed in blank and that is really no lawful consideration at all since the firm of Belasirai & Co. had no right whatever to withhold those notes from the defendant Nagindas. The question is whether the story told by Nagindas is true. It was strongly contended on behalf of. the plaintiff that the letter Ex. 2, dated-the 22nd March 1912, merely sets forth a true statement of the actual indebtedness of Nagindas to the firm of Belasirai & Co. on that date. This argument starts from the allegation that in the previous December Nagindas or his representative Wamanrao Bhai Thakore had met the creditor-firm of Belasirai & Co. in the offices of Messrs. Mulla & Co. and settled the then existing indebtedness at about Rs. 21000 in part discharge of which the defendant Nagindas had given a cheque of Rs. 10,000. This would leave just as much indebtedness over as is acknowledged in the letter of the 22nd March 1912. However plausible that argument at first sight may appear, it labours under one fatal defect. The amount due in 1911 includes the sum of Rs. 3700 which certainly could not has been" due until the 20th of March 1912. On the other hand every circumstance appears to me to pain conclusively to the truth of Nagindas s stary. It is almost incredible that with the result of the suit decided in March fresh incredible should have immediately recommenced the same course of dealing which had there resulted so disastrously; and it is clear from the letter of the 22nd Marefe to which the plaintiff takes no exception, that the firm of Belasum & 1 Co. did restore to Nagindas roughly some Rs. 75000 worth of promissory- notes for which Nagindas had received no value. It appears to me, therefore, antecedently probable in a the highest degree that the firm of Belasirai &-Co. exacted as the price of That restoration the sum of Rs. 3700 whit included these Uttwdi now Ist dispute. Of the remaining three Hundies which Nagindas has the acknowledge under the- letter of the 22nd of March, one only is now admitted as genuine. The r reason why the other two were included may be conjectured to be that Belasirai & Co. had actually sold them and therefore required the defendant Nagindas to acknowledge their genuineness. However that may be, having regard to the previous history of Nagindas as revealed in the former case and not disputed here, to the termination of that case, and to the fact that this Hundi was undoubtedly drawn almost immediately afterwards and that contemporaneously with it Nagindas received back almost all the other Hundis in respect of which he had good reason to fear he might be defrauded, I have little hesitation in holding that the account he has given of this Hundi and the manner in which he came to make it is true. That being so, it lies upon the plaintiff to prove that he is a holder in due course and is in a better position than his transferor who would have certainly not been able to recover the amount of the Hundi (if my view be correct) from the defendant Nagindas. At the close of the plaintiff s case, his counsel suggested that the defendant Nagindas was estopped from alleging against plaintiff that the Hundi was obtained for unlawful consideration. This argument rests upon the me assertion that on the 3rd April 1912 the plaintiff gave Nagindas notice that the firm of Belasirai & Co. had transferred this Hundi to him. And since the defendant Nagindas did not at once inform the plaintiff in reply to that notice of all the circumstances in which the Hundi had been extorted from him, he is now estopped from doing so. The short answer to that is that the alleged notice of April 3rd, 1912, is not proved. There is no evidence before me of its existence. Then, the plaintiff falls back upon his attorneys letter of the 23rd of April, but I think that mere neglect to answer the attorneys letter peremptorily enforcing a claim of this kind could never be made good ground for such an estoppel as that the plaintiff now wishes to raise against Nagindas.