TMI Blog2006 (10) TMI 515X X X X Extracts X X X X X X X X Extracts X X X X ..... ry note in favour of one Mangalakshmi Ammal on 1.8.1988 for a valid consideration of Rs. 25,000/- agreeing to repay the same with interest at 12% per annum and no amount was paid either for principal or for interest and on 7.2.1991, Mangalakshmi Ammal assigned the promissory note in favour of the plaintiff for a valid consideration and the plaintiff issued a notice to the defendant on 2.4.1991 calling upon him to pay the entire amount and the defendant sent a reply with false allegations and hence the suit. 3. Plaintiff Kalaiselvan filed the suit in O.S. No. 242 of 1991 seeking for a decree for Rs. 31,712.50 with costs and further interest and the case of the plaintiff is that the defendant executed a promissory note in favour of one Ush ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k in O.S. No. 139 of 1985 on the file of Subordinate Judge, Villupuram against the son and father and the son submitted to the decree and the father remained ex parte and a preliminary decree was passed on 3.3.1986 and a final decree also was passed on 30.6.1987 for the sale of the properties. The defendant has further stated that under the above circumstances, the abovesaid lands were conveyed to him and his minor son by two registered sale deeds dated 8.8.1988 for consideration of Rs. 53,800/- and Rs. 72,075/- respectively and on the date of sale, the decree obtained by the Bank was subsisting and the defendant was not aware of the same and later on, he came to know that a fraud was played by the vendor by wilfully suppressing the decr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent, for the sake of convenience, the parties are referred to as arrayed in the suits. 6. The points for determination in the appeals are: 1. Whether the suit pronotes are not supported by consideration as alleged by the defendant. 2. Whether the assignment of the suit pronotes in favour of the plaintiff is valid and consequently whether he is a holder in due course , entitled to recover the amounts. POINT Nos. 1 and 2: 7. Exs.A1 and A5 are the pronotes dated 1.8.1988 in the suits. The defendant has admitted the execution of the above pronotes in favour of the assignors of the plaintiff, but contends that they are not supported by consideration and they were executed as a security for due performance of an agreement to pay a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... promissory notes and recover the amounts due under them. 10. The case pleaded by the defendant in the written statement is that he purchased the properties owned by Chandrasekaran under Exs.B1 and B2, registered sale deeds dated 8.8.1988 and on the date of sale, Ex.B4, mortgage decree debt, suffered by Chandrasekaran to the bank was subsisting on the properties and that was suppressed by Chandrasekaran and later, the defendant came to know about that and Chandrasekaran wanted an additional sum of Rs. 50,000/- from the defendant for discharging the debt and as a security for paying the said sum, the defendant executed Exs.A1 and A5, suit pronotes, in favour of his mother and wife viz., the assignors of the plaintiff. The defendant examin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rted by consideration, cannot be accepted. 12. Exs.A2 and A6 are the endorsements of assignments in favour of the plaintiff, made on Exs.A1 and A5 pronotes respectively. P.Ws.2 and 3 have stated that they received the amounts due under the promissory notes from the plaintiff and endorsed those pronotes in favour of the plaintiff. 13. The plaintiff, as P.W.1 has categorically stated that he paid the due consideration on the promissory notes and obtained assignments from P.Ws.2 and 3 and in proof of payment, he has filed Ex.A9 Bank account containing the relevant entry. The endorsements on the assignments also speak about the passing of consideration. 14. The decisions relied on by the learned Counsel for the appellant, reported in ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ker Simon Carves India Ltd. AIR1976Ker5 and N.D.P. Namboodiripad, J. referred the above decision of the Division Bench while examining the scope of the provisions of Sections 36 and 43 of the Negotiable Instruments Act and held as follows: The very essence of a negotiable instrument is its negotiability and as is well-known there may be one or more assignments of the rights under an instrument. Absence of consideration, or failure of consideration could avoid the liability only as between the parties to the particular transaction for which there was no initial consideration or there was a subsequent failure of consideration. That the legislature never intended to extend such avoidance of obligation to other transactions pertaining to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
