1965 (9) TMI 72 - HC - Indian Laws

Revision petition dismissed due to inadequate explanation for altered promissory note

The revision petition was dismissed as the plaintiff failed to provide a valid explanation for the material alteration in the promissory note, resulting ... Material alteration of a negotiable instrument - date as a material part of a promissory note - voidness of an instrument under Section 87 of the Negotiable Instruments Act - onus on the holder to explain an apparent alteration - alteration to carry out the common intention of the original partiesMaterial alteration of a negotiable instrument - date as a material part of a promissory note - voidness of an instrument under Section 87 of the Negotiable Instruments Act - Promissory note was materially altered by changing the date and is void under Section 87 of the Negotiable Instruments Act. - HELD THAT: - The lower Court found, on examination of the promissory note, visible erasure and subsequent rewriting of the figure '9' where an earlier figure existed, with paper thinning and ink spread indicating alteration. The date of a promissory note is a material particular because it fixes the time of execution and can determine limitation; accordingly an alteration of the date renders the instrument void against a party who did not consent to the alteration unless the alteration was made to carry out the common intention of the original parties. The plaintiff, as the holder seeking to enforce the instrument, bore the burden to explain the apparent alteration. No satisfactory explanation was offered and there was no evidence of consent or of a pre-execution correction. In those circumstances the document was rightly treated as void under Section 87 and incapable of enforcement. [Paras 2, 4, 6, 9, 10]The promissory note was materially altered as to date and is void; the plaintiff cannot enforce it.Onus on the holder to explain an apparent alteration - alteration to carry out the common intention of the original parties - Failure of the plaintiff to explain the alteration and absence of corroborative evidence mandated dismissal despite defendant's non-production of a diary. - HELD THAT: - Although the defendant asserted the earlier date and mentioned a diary not produced, the lower Court disbelieved both parties' evidence and found no reliable explanation from the plaintiff for the suspicious condition of the document. The settled rule places on the party presenting an apparently altered negotiable instrument the duty to explain when and how the alteration was made or to produce corroborative proof sufficient to rebut the presumption that the alteration was made subsequently and without consent. No such explanation or corroborative evidence was furnished here; production or non-production of the defendant's diary did not alter the consequence that the plaintiff failed to discharge the onus. [Paras 3, 4, 8, 9, 10]The plaintiff's failure to explain the alteration and absence of corroborative proof warranted dismissal of the suit; the defendant's unproduced diary did not change this result.Final Conclusion: The revision petition is dismissed; the suit based on the promissory note was rightly dismissed because the note was materially altered and could not be enforced. Issues:1. Material alteration in a promissory note changing the date from 22nd to 29th.2. Burden of proof on the party seeking to enforce a promissory note with a material alteration.3. Application of Section 87 of the Negotiable Instruments Act regarding material alterations.4. Requirement for explanation of alterations in negotiable instruments.5. Presumptions and burdens of proof in cases of altered promissory notes.Analysis:The judgment pertains to a revision petition arising from a suit for the recovery of a sum based on a promissory note. The central issue was a material alteration in the promissory note, changing the date from 22nd to 29th, allegedly to bring the suit within the limitation period. The lower court found the alteration suspicious due to erasures and rewriting, leading to the dismissal of the suit.The main contention raised was the burden of proof on the party seeking to enforce the promissory note with a material alteration. The plaintiff failed to explain the alteration satisfactorily, leading to the application of Section 87 of the Negotiable Instruments Act, which renders a negotiable instrument void if materially altered without consent. The date of a promissory note was deemed a material part, and any alteration in it would render the note void unless with mutual consent.The judgment emphasized the requirement for the party holding the altered instrument to explain the alteration, especially when seeking enforcement. The law places a heavy burden on the plaintiff to prove the alteration's legitimacy and timing. Failure to provide a satisfactory explanation results in the presumption that the alteration occurred post-execution, rendering the promissory note void under Section 87.The judgment cited legal principles from English law and Indian decisions, highlighting the necessity for parties to address alterations in negotiable instruments. It underscored the importance of removing suspicions surrounding altered documents and the consequences of failing to provide a credible explanation for such alterations.In conclusion, the revision petition was dismissed as the plaintiff failed to offer a valid explanation for the material alteration in the promissory note, leading to its voidance under Section 87. The judgment reiterated the legal stance on altered negotiable instruments and the burden of proof on parties seeking to enforce such instruments.