- (1.) THIS is defendants' second appeal challenging the judgment and decree of the trial Court dated 5.10.2010 whereby suit of the plaintiff -respondents for recovery on the basis of the pronote and receipt was decreed. Further challenge has been laid to the judgment and decree of the lower Appellate Court dated 4.9.2013 dismissing the defendants' first appeal against the aforesaid judgment and decree of the trial Court.
(2.) SUFFICE it to say that appellants in their written statement have denied the execution of alleged pronote and receipt and further stating that the same is forged and fabricated document. Further objection was taken that appellants have failed to comply with the provisions of Section 3 of Punjab Registration of Money Lenders Act, 1938 and the suit was bad for misjoinder of the parties for the reasons that the partnership firm was dissolved on 31.3.1992 and defendant No.2 had become the sole proprietor of the said firm, after its dissolution and in these circumstances, other defendants could not have been fastened with liability.
(3.) LEARNED counsel for the appellants has submitted that following substantial questions of law arise in this appeal: - 1. Whether the alleged pronote and receipt could have been proved in the absence of regular deed writer and could be believed to fasten the appellants with the liability to pay the amount in dispute? 2. Whether the impugned judgments and decrees dated 5.10.2010 and 4.9.2013 passed by the Courts below are legally sustainable in the eyes of law? 3. Whether the alleged transaction offends the provisions of Section 269 -SS of the Income Tax Act, 1961? 4. Whether the impugned judgments and decrees could not have been passed in view of Section 3 of the Punjab Registration of Money Landers Act, 1938? 5. Whether the predecessor -in -interest of the respondents no.1 to 5 was required to possess a licence under the Registration of Money Landers Act, 1938 for the recovery of the alleged loan advanced by him? In support of his case, learned counsel for the appellants has vehemently argued that suit was not maintainable in view of the provisions of Section 3 of the Punjab Registration of Money Lenders Act, 1938 as according to the aforesaid provisions of the Act, it is the duty of a money lender to produce the certificate of registration granted under the Act, whereas, admittedly, the plaintiff is not having any licence to do money landing business. Moreover, it is proved on record that the firm was dissolved in the year 1992 and on that account all the defendants were not liable and in this way, the suit itself was bad for misjoinder of necessary parties. It is useful to refer to the observations of the lower Appellate Court at this stage which read thus: - 13. While deciding issues No.1 to 4, the learned lower Court arrived at a conclusion that the promissory note Ex.P1 and receipt Ex.P2 were executed by Darshan Singh being partner of the firm M/S Kartar Singh Sama and Sons on 26.1.2000 and the said documents were executed by him in favour of the plaintiff. Said Darshan Singh also signed endorsement on the back side of original promissory note. By way of examining Expert coupled with the testimony of the plaintiff and Sham Sunder PW1, marginal witness of the alleged pronote and receipt, due execution of the pronote and receipt was proved by the plaintiff and. as per the provisions of Section 118 of the Negotiable Instrument Act, when execution of the pronote and receipt has been duly proved then presumption of consideration having been passed arises thereof. So, it was incumbent upon the defendants to lead sufficient evidence so as to discard and to rebut the proved version of the plaintiff, but the evidence having been led on behalf of the defendants is not sufficient to dispel the claim of the plaintiff in this regard, rather inconsistent testimony having been led by Darshan Singh itself causes infirmity in his version and in this way the case of the plaintiff itself was substantiated through the cogent and convincing evidence having been led on his behalf. Defendants No.1 and 2 in the written statement claimed that the alleged pronote and receipt do not contain signatures of defendant No.2 and to establish this fact, defendant No.2 was bound to lead sufficient evidence on his behalf. If the said defendants claim that the document i.e. pronote and receipt are forged and fabricated, then it was incumbent upon him to prove this fact by way of leading substantive evidence, but defendant No.2 has not led any such evidence so as to prove his case. 15. For the purpose of establishing the plea to the effect that the plaintiff is money lender, the defendant was also bound to lead evidence. Mere isolated transaction would not make the plaintiff as money lender unless and until consistent evidence through the documentary record in this regard is produced on the file. Defendant No.1 firm was indulged in the business of commission agency. No such account book of the said firm has been produced on record so as to substantiate the plea of defendant no.1 that there was no transaction between the plaintiff and defendant No.1. No reason has been testified for with holding the production of the said record by defendant No.1. Reliance can be placed on the observations made in case Amar Singh Vs. Kuldip Singh and Others, 1952 AIR(P&H) 207 wherein it was laid down that a man does not become a money lender within the meaning of Section 2(a) of the Punjab Registration of Money Lenders Act, 1938, by reason of occasional loans to relations, friends or acquaintances, whether interest be charged or not. Charity and kindliness are not the basis of usury. Nor does a man become a money lender merely because he may upon one or several isolated occasions lend money to stranger. There must be a business of money lending and the word business imparts the nation of system, repetition and continuity. An element of continuity is, therefore, essential to constitute the exercise of a profession or business. So, the plea of the learned counsel for the appellant that stamps on the pronote were not duly cancelled is not sustainable as the stamps having been affixed on the pronote reveal that they have been affixed in such a manner that their refixation does not appear to be possible and the same have been signed by Darshan Singh defendant commencing from the paper towards the stamps, rather last fifth stamp also bears the ink in continuity of the signatures. So, on this account, it cannot be assumed that the stamps having been affixed on the pronote were not, cancelled and, therefore, said pronote is inadmissible in evidence and the objection raised by the appellants is not sustainable. 16. Mere non mentioning of the alleged transaction pertaining to the pronote and receipt in the income tax return would not lead towards the inference that the pronote was not executed by defendant Darshan Singh. Non submission of the details in the income tax return by the plaintiff in this regard may lead towards penalty upon the plaintiff, which he may suffer in due course of procedure, but on this account it cannot be assumed that the said pronote is in admissible. There is no illegality, infirmity or perversity in the findings arrived at by the learned trial Court, which are based on sound foundation, and as such, the same do not call for any interference by this Court." Thus, it may be noticed that the plea of money lending by the plaintiff -respondent is not established. There is no evidence to prove the aforesaid fact. Mere isolated transaction would not make the plaintiff a money lender unless and until consistent evidence in the form of documentary record in this regard is brought on record that the plaintiff -respondent was involved in the business of money lending. In the case of Amar Singh vs. Kuldip Singh and others, 1952 AIR(P&H) 207, was held that a person does not become a money lender within the meaning of Section 2(a) of the Punjab Registration of Money Lenders Act, 1938, by reason of occasional loans to relations, friends or acquaintances. Nor does a man become a money lender merely because he may upon one or several isolated occasions lend money to stranger. There must be a business of money lending and the word 'business' imparts the notion of system, repetition and continuity and an element of continuity is, therefore, essential to constitute the exercise of a profession or business.;