HIGH COURT OF RAJASTHAN
Click here to view full judgement.
JAGAT NARAYAN, J. -
(1.)THIS is a revision application by the defendants against an order of the District Judge Pali holding that a certain writing is not a promissory note.
(2.)ACCORDING to the case of the plaintiffs, who have filed the writing and who seek to prove it, they and the defendants carried on business in partnership at Pali. This business was closed on Kartik Sudi 1 S. 2004. Then the parties started another partnership business at Falna. Accounts were settled on 25-12-52 and by mutual agreement the plaintiff withdrew from the partnership. A sum of Rs. 35,956/6/6 remained due to them from the defendants on that date. All the assets and liabilities of the partnership business were taken over by the defendants. Two letters were written on that date one by each party. The letter written by the defendants in favour of the plaintiffs which is the subject matter of the present revision application runs as follows: - "bhai Multanmal Santok Chandji Sri Bali, Written from Falna. Greetings from Bhai Roop Chand Hans Rajji. We were carrying on business in wood and cotton seed in partnership, shares being equal, in the name of Veer Chand Roop Chand at Falna station and we had business in partnership, shares being equal at Pali under the name and style of Prem Chand Heera-Chand & Co. in wood, cotton-seed, stone, glass etc. We have understood the accounts of both these partnerships today. Your share of profit has been fixed at Rs. 5000/ -. All the assets and liabilities have been taken over by us. You are no longer responsible for partnership dealings. A sum of Rs. 24125/8/- has been found due to you in the accounts of Veer Chand Roopchand upon Kartik Sudi 1 S. 2008. Further a sum of Rs. 9510/8/9 which you Multan Mal Santok-Chand invested in firm Prem Chand Heerachand & Co. is also due to you on Kartik Sudi 1 S. 2004. Thus Rs. 24125/8/- principal and Rs. 075/9/3 interest and Rs. 9510/8/9 Principal and Rs 2000/1/9 interest upto today half of which comes to Rs. 5752/5/3 and together with Rs. 5000/- due as profits, all the three items totalling Rs. 35,956/6/ remain to be paid by us. This will carry interest at annas -/6/- percent per mensem. We have also taken a letter from you about these matters. Dated Poh Sudi 9 S. Scribed by Ranawat Umedmal Jawaharmalji resident of Bali at the instance of Roopchand Hans Rajji at Falna Station. Sd/ - Roop Chand Bagrecha. The contention on behalf of the defendants is that this document amounts to a promissory note. The contention on behalf of the plaintiffs is that it does not contain an undertaking to pay and it cannot amount to a promissory note. It is an agreement.
A perusal of the wordings of the writing goes to show that it does not contain an undertaking to pay and therefore it cannot be a promissory note. It is clearly an agreement.
On behalf of the defendants the case of Devi Prasad Vs. Bhagwati (1) was cited. The document in that case runs as follows: - "rupees 1300/-, date Pus Sudi, six. Received rupees thirteen hundred; took on 8 annas percent. " It was held that the document was an acknowledgment coupled with an agreement to pay interest and that it amounted to an agreement with a promise to pay within the meaning of sec. 25 (3) of the Contract Act. Sec. 25 (3) runs as follows: - "an agreement made without consideration is void unless (3) it is a promise, made in writing and signed by the person to be charged therewith, or by his agent generally or specially autho rized in that behalf, to pay wholly or in part a debt of which the creditor might have enforced payment but for the law for the limitation of suits. " This ruling is of no help in the present case as the requirements of a promissory note are quite different. In order that a document may be a promissory note it should contain an express promise to pay. In Debiprasad's case (1) it was held that in case of an agreement to pay a time barred debt an express promise was not necessary and an implied promise would satisfy the requirements of sec. 25 (3), Contract Act.
Another ruling which was referred to on behalf of the defendants was the decision in Muthu Sastrigal Vs. Visvanatha Pandarasannadhi (2 ). The document in that case ran as follows: - "i shall in two weeks' time, returning this sum of Rupees three hundred and fifty with interest thereon at the rate of rupee one %, per month, get back this letter. " The above document contains an express promise to pay inasmuch as it is mentioned in it that the executant shall return the sum of Rs. 350/- with interest in two weeks' time. My attention was also drawn to illustration (b) to section 4 of the Negotiable Instruments Act which is as follows: - "i acknowledge myself to be indebted to B in Rs. 1,000/- to be paid on demand, for value received. " In Mohammad Akbar Khan Vs. Attar Singh (3) the Privy Council considered the effect of this illustration. Their Lordships first expressed their doubt whether an implied promise to pay would be sufficient for a promissory note. Then, they pointed out that the implied promise to pay arising from the acknowledgment of a debt would not be sufficient for this purpose and this was shown by the third illustration under the section. Then, referring to the second illustration their Lordships observed as follows: - "the second illustration however, seems to show that the express words 'i promise' or 'i undertake' are unnecessary. The form of words is taken from an early English case, reported in Selwyn's N. P. 11th Edition, P. 401, from Scacc. M. I. Geo. II MSS (Casborne Vs. Dutton), where according to the learned author the Court stated that the word 'to be paid' in the document there sued on amounted to a promise to pay observing that the same words in a lease would amount to a covenant to pay rent. It does not appear to form a useful general illustration except in the case of a document in that particular form of words. " From the language of sec. 4 of the Negotiable Instruments Act it is quite clear that the promise to pay must be express. As was held by their Lordships of the Privy Council in Bengal Nagpur Railway Co. Ltd. Vs. Ruttanji Ramji (4) an illustration cannot have the effect of modifying the language of the section which alone forms the enactment. In any case the present document is not exactly in the form of this illustration. This illustration is therefore not helpful to the applicants.
Ccordingly dismiss the revision application with costs.
Let the record be returned immediately to the trial court so that the suit may be proceeded with. .
Copyright © Regent Computronics Pvt.Ltd.