1948 (11) TMI 14 - HC - Indian Laws

Court upholds Rs. 8,000 decree for plaintiff; defendant fails to prove hundis were for accommodation.

Tarmahomed Haji Abdul Rehman Versus Tyeb Ebrahim Bharamchari

The court upheld the decree for Rs. 8,000 in favor of the plaintiff as the defendant failed to prove the hundis were for accommodation, maintaining the ... - Issues Involved:1. Whether the hundis were passed for the accommodation of the plaintiff.2. What relief is the plaintiff entitled toRs.3. Whether the defendant is entitled to the return of the said three hundis as alleged in the counter-claim.Issue-wise Detailed Analysis:1. Whether the hundis were passed for the accommodation of the plaintiff:The primary issue was whether the hundis were passed for the accommodation of the plaintiff, as alleged by the defendant. The learned Judge concluded that the defendant failed to prove that the hundis in question were passed for accommodation. The statutory presumption under Section 118 of the Negotiable Instruments Act, 1881, was a key point of contention. The section states, 'Until the contrary is proved, the following presumptions shall be made: (a) that every negotiable instrument was made or drawn for consideration.' The defense argued that if the consideration mentioned in the hundis was not the real consideration, the presumption under Section 118 was rebutted, and the burden shifted to the plaintiff to prove the actual consideration. However, the court held that the presumption is in favor of there being a consideration for the negotiable instrument, not necessarily the consideration mentioned in the instrument. The court emphasized that proving the contrary, i.e., that the negotiable instrument was without consideration, is the only way to rebut the presumption. The court found that the defendant did not meet this burden.2. What relief is the plaintiff entitled toRs.The relief sought by the plaintiff was a decree for Rs. 8,000 based on the three hundis. The court found that since the defendant failed to prove that the hundis were for accommodation, the statutory presumption under Section 118 continued in favor of the plaintiff. The court also considered whether the plaintiff had succeeded in proving the consideration for the hundis. Although the plaintiff failed to prove the specific consideration he alleged, this failure did not negate the statutory presumption of consideration under Section 118. Therefore, the plaintiff was entitled to the relief sought, and the decree for Rs. 8,000 was upheld.3. Whether the defendant is entitled to the return of the said three hundis as alleged in the counter-claim:The defendant's counter-claim for the return of the three hundis was based on the assertion that they were passed for accommodation. Since the court found that the defendant failed to prove that the hundis were for accommodation, the counter-claim was not substantiated. The statutory presumption of consideration under Section 118 was not rebutted, and the burden of proof remained on the defendant to establish that there was no consideration for the hundis. The court concluded that the defendant did not meet this burden, and therefore, the counter-claim for the return of the hundis was dismissed.Conclusion:The court upheld the decree for Rs. 8,000 in favor of the plaintiff, as the defendant failed to prove that the hundis were for accommodation and did not rebut the statutory presumption of consideration under Section 118 of the Negotiable Instruments Act. The defendant's counter-claim for the return of the hundis was dismissed. The appeal was dismissed with costs, and the cross-objections regarding the trial court's order for costs were also dismissed.