Satnam Singh v. Nar Singh Dass Gupta

Mr.V.K.Bali, Advocate for the appellant Mr.Harsh Aggarwal, Advocate for the respondent AJAY TEWARI J. (ORAL) . . . This appeal has been filed against the concurrent judgments of the Courts below decreeing the suit of the respondent for recovery on the basis of entries in the Books of Accounts. The respondent had filed the suit claiming that the appellant used to take monetary advances from time to time. On

06.10.1998, the appellant agreed to take over the loan amounting to Rs.3,62,443.76P/- and an entry to this effect was made in the Bahi of the respondent. He further states that an amount of Rs.5,18,537/- remained due from the appellant on account of the principal as well as interest. The appellant in his written statement took the plea that the defendant used to borrow money from M/s Laxmi Sales Corporation and the plaitniff- respondent got the signature of the defendant-appellant on blank papers and manipulated the documents. Both the Courts below accepted the case of the respondent and consequently, decreed the suit. RSA No.230 of 2007 (O & M) 2 The following questions have been proposed:- (i) Whether the courts below could pass a judgment and decree for recovery of an amount of Rs.5,18,537/- without there being any legal evidence proved on the record ? (ii) Whether the appellant has been proved to be agriculturist and being so, present suit is not barred under the provisions of Haryana Agricultural Relief of Indebtness Act as proved on the file ? Both the Courts on facts, found that having admitted the signatures, the onus shifted to the appellant, and a bare denial of the transaction would not suffice. Learned counsel has relied upon the case of Jangir Singh Vs. Firm Hari Chand Om Parkash, Arhati, Budhlada, 2000 (2) PLR 740, wherein this Court held as follows:- “Until a due execution of a document is established no adverse inference can be drawn against a person who simply puts a signature or thumb-impression on a document. It is the common cases of the parties that in the present case Shri Jangir Singh defendant was a simpleton agriculturist. It was obligatory upon the plaintiff to prove the due execution and payment of consideration. On both these counts, the plaintiff has failed and the payment of Rs.5300/- on the basis of bahi entry P.1 is not proved”. Further reliance has been placed upon the case of M/s Hada Steel Products Limited (In Liquidation) Vs. M/s Emjay Engineering Enterprises, Bombay, 1995 (3) PLR 254, this Court held as follows:- “5. The sole question to be determined in this case is as to whether the goods were received by the respondent and whether payments of those goods was made to the Company. The respondent has admitted the receipt of goods as per invoices Exhibits PW2/1 to PW2/9. A perusal of the statement of accounts produced by the Company makes it quite clear that the RSA No.230 of 2007 (O & M) 3 price of these goods was paid to the Company and the same stands reflected in that statement. In this view of the matter, it has to be held that the goods received by the respondent in terms of the aforesaid invoices have been paid for and no amount was due to the Company from the respondent. As regards the goods said to have been sent to the respondent through invoice Exhibit PW2/10, the receipt of the same has been denied by it. There is not even an iota of evidence on the record to show that the goods mentioned in this invoice (Exhibit PW2/10) were ever received by the respondent. The liability for the payment of those goods is sought to be fastened on the respondent solely on the basis of entries in the books of account which have been produced on the record. It is a settled principle of law that no person can be charged with liability merely on the basis of entries in the books of account even where such books of account are kept in regular course of business. There has to be further evidence to prove the receipt of goods by the person who is sought to be made liable for payment. Besides, a mere look at the statement of account produced by the Official Liquidator shows that the same is not correct as it contains a large number of arithmetical/clerical errors. In the absence of any evidence to show that goods mentioned in Exhibit PW2/10 were ever received by the respondent, it cannot be made liable for their payment”. Learned counsel for the respondent on the other hand has relied upon Jagat Ram Vs. Hawa Singh, 2001 (2) Apex Court Journal 245 (S.C.), wherein the Hon'ble Supreme Court held as follows:- “10. We have perused the judgment of the First Appellate Court in para 10 whereof the entry in the account book “Bahi Entry” is quoted verbatim. On the plain reading of the said entry it is clear to us that the respondent has acknowledged receipt of the sum of Rs.15,000/- as loan with interest at the rate of Rs.1.50 RSA No.230 of 2007 (O & M) 4 per month and with the further stipulation that the amount shall be returned by Ist January, 1986. The finding of the First Appellate Court that in the entry the past transactions between the parties amounting to Rs.15,000/- to be paid by the respondent which does not show passing of consideration on the date of the entry is clearly based on the misreading and misconstruction of the entry. The respondent as noted earlier admitted his signature on the account book. He made a bare denial of receipt of the amount on the plea that he might have been in a drunken state at the time of making the entry. Such a bare denial in the circumstances of the case is not sufficient to rebut the presumption under Section 118 of the Negotiable Instruments Act, 1881. The position was accepted by this Court in the case of Bharat Barrel and Drum Manufacturing Company Vs. Amin Chand Payarelal JT (1999) SC 576. As regards the judgments cited by the learned counsel for the appellant, it may be noticed that once the appellant is not in a position to dispute his signautres, then, keeping in view the judgment of the Hon'ble Supreme Court in Jagat Ram (supra), it has to be held that a mere bare denial is not sufficient to represent the presumption under Section 118 of the Negotiable Instruments Act. Further, as regards the judgment of this Court in (a) Jangir Singh (supra), (b) M/s Hada Steel Products Limited (In Liquidation) (supra), the present is not a case, where only Bahi entries have been pressed into service; rather the respondent himself has deposed about the same. As regards, questions No.(i) and (ii), learned counsel has taken me through the findings of the learned lower Appellate Court recorded thereon but has not been able to persuade me that the said findings are either based on no evidence or on such perverse misreading of the evidence so as to be liable for interference under Section 100 CPC. RSA No.230 of 2007 (O & M) 5 Accordingly, the present appeal is dismissed. No costs. Since the present appeal is decided, the stay application along with Civil Miscellaneous Application, if any, stands disposed of accordingly. March 11, 2010 Sukhpreet (AJAY TEWARI) JUDGE