HC - the plaintiff is not entitled to interest from the date when it was borrowed, but once it is not a loan transaction, he is entitled to interest only from the date of the suit


IN THE HIGH COURT OF JUDICATURE OF ANDHRA PRADESH

AT HYDERABAD


HON’BLE SRI JUSTICE A. GOPAL REDDY


 

SECOND APPEAL No.1130 of 2010

 

Dated: 10-12-2010

 

Between:

 

Vaddi Venkata Purushotama Rao

…Appellant

AND

 

Vaddi Tirumaleshwara Rao

Respondent.

 

 

 

This Court made the following:


HON’BLE SRI JUSTICE A. GOPAL REDDY


 

SECOND APPEAL No.1130 of 2010

 


JUDGMENT:    


This is a defendant’s appeal against the judgment and decree of VIII Additional District & Sessions Judge (Fast Track Court), Vijayawada in allowing A.S.No.279 of 2007, dated 23.7.2010 and decreeing the suit of the plaintiff by setting aside the judgment and decree of IV Additional Junior Civil Judge, Vijayawada dismissing the suit in O.S.No.1926 of 2005, dated 13.3.2007.

For the sake of convenience, the parties hereinafter will be referred to as per their array before the trial Court.

The plaintiff who is the elder brother of the defendant filed the above suit for recovery of Rs.33,520/- being the principal and interest alleging that the defendant borrowed a sum of Rs.30,000/- on 3.3.2005 by executing a promissory note agreeing to repay the same with interest at 24% per annum.   As the defendant did not pay the said amount in spite of repeated requests, the plaintiff got issued a notice on 10.8.2005.   In spite of the notice as the defendant did not pay the said amount, the present suit is filed.   The defendant contested the suitinter alia contending that the plaintiff materially altered the reverse of the suit promissory note, dated 3.6.2005, that there was no necessity for him to borrow the suit amount from the plaintiff, that he never executed the suit pronote and that the same is not supported by consideration.  It is alleged that the present suit is filed to have wrongful gain and the plaintiff is not entitled for the decree as prayed for. 

Basing on the above pleadings, the trial Court framed necessary issues for trail.  To substantiate the claim, plaintiff himself examined as P.W.1 and the attestor and scribe of suit pronote were examined as P.Ws.2 and 3 and Exs.A.1 to A.4 were marked.  The defendant himself examined as D.W.1 and marked the backside endorsement of Ex.A.1 as Ex.B.1.

The trial Court upon appreciation of entire oral and documentary evidence and after taking into consideration the admission made by the plaintiff as P.W.1 that in Ex.B.1-endorsement there are corrections and that it is not a loan transaction, dismissed the suit.  On appeal being filed by the plaintiff, on re-appreciation of the entire evidence, the lower appellate Court observed that the trial Court has mainly relied on Ex.B.1 endorsement, which is on the back of Ex.A.1 pronote, that this endorsement was written by the defendant himself. That the defendant had written some mistakes and corrected it in third line that he did not owe money.   In the said endorsement, the defendant agreed to pay back Rs.30,000/- after obtaining bank loan without interest.  It was mentioned that for household expenses, the money was given by plaintiff and that it is not a loan and he voluntarily agreed to repay the same, which does not mean that Ex.A.1 pronote was not at all supported by consideration.  In Ex.A.1 it was mentioned that for household expenses, the defendant borrowed money and the same thing was mentioned in Ex.B.1 also after three months of execution of Ex.A.1 and therefore, there is no inconsistency in the matter.   Once the defendant acknowledged the debt due under Ex.A.1 and about plaintiff paying the money to the tune of Rs.30,000/- for household expenses, but not as a loan, the plaintiff, at the most, is entitled to principal money but not interest, and holding so, the lower appellate Court decreed the suit setting aside the judgment and decree of the trial Court.     

Learned counsel for the appellant strenuously contends that the lower appellate Court has not taken into consideration the admission of P.W.1 in the cross-examination, where he admitted that there are corrections in the third line in Ex.B.1 endorsement on the backside of suit pronote-Ex.A.1 and that there is a space in between the two words of the 4th line of the endorsement and there are over writings and he did not object for writing the said endorsement as it is not a loan and therefore, the suit cannot be decreed.  This court does not find any merit in the contention advanced by the learned counsel for the appellant.   The plaintiff discharged the burden of execution of Ex.A.1-pronote being executed by the defendant.  The execution of Ex.A.1 was denied by the defendant in the written statement, but whereas, the plea taken by him in the argument is that Ex.A.1-pronote was signed by him as a blank pronote and therefore, the same was rightly not accepted by the lower appellate Court.  When Ex.B.1-endorsement itself was marked at the instance of the defendant-appellant, which was admitted by the plaintiff in the evidence about the corrections and the endorsement made by the defendant himself on the back of Ex.A.1, it is not open for the defendant-appellant to contend that Ex.A.1-pronote is signed by him as a blank pronote and in the absence of any such plea taken in the written statement, he cannot be permitted to plead the same.  It is for the defendant-appellant to establish as to how he made such an endorsement under Ex.B.1 on the back of Ex.A.1-pronote.   In the said endorsement, the defendant categorically admitted to pay back Rs.30,000/- by obtaining the bank loan without interest with a further mention that for household expenses, the money was given by the plaintiff and that it is not a loan, which itself shows that the transaction cannot be treated as a loan transaction for payment of the interest.   In view of the said endorsement-Ex.B.1, the defendant is under obligation to pay the said principal amount without any interest.   Therefore, the lower appellate Court rightly held that the plaintiff is not entitled to interest from the date when it was borrowed, but once it is not a loan transaction, he is entitled to interest only from the date of the suit and accordingly decreed the suit.  No question of law much less substantial question of law arises for consideration in this second appeal.       

The second appeal fails and is accordingly dismissed.   No order as to costs.


                                                  
                                                                ________________
            A. GOPAL REDDY, J.

DECEMBER 10, 2010                                                      
Tsr.


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