Material alteration of a promissory note can void enforcement unless the holder explains the change and proves an independent claim.

A materially altered promissory note is void against a non-consenting party, and the holder must affirmatively explain when and how the alteration was made and show it was not improperly made. If the alteration is not satisfactorily explained, the instrument is presumed to have been altered while in the holder's custody and becomes unenforceable. The claimant cannot then recover on the original consideration unless an independent loan claim is separately pleaded and proved; where the suit is founded on the note as part of the same transaction, the original debt cannot be enforced once the note is void.

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Issues: (i) Whether a materially altered promissory note became void against the holder even though it was not shown that the plaintiff personally made the alteration, and whether the burden lay on the plaintiff to explain the alteration. (ii) Whether, after the promissory note became void for material alteration, the plaintiff could still recover the original consideration allegedly advanced.

Issue (i): Whether a materially altered promissory note became void against the holder even though it was not shown that the plaintiff personally made the alteration, and whether the burden lay on the plaintiff to explain the alteration.

Analysis: Section 87 of the Negotiable Instruments Act, 1881 was applied according to its plain effect that a material alteration renders the instrument void against a party who did not consent to it. The Court held that the protection of the section is not confined to alterations proved to have been made by the holder personally. Where the instrument appears altered, the burden lies on the plaintiff, as holder, to show when and how the alteration was made and that it was not improperly made. In the absence of such proof, the alteration is presumed to have been made by the plaintiff or by someone acting with his consent or negligence while the instrument was in his custody.

Conclusion: The altered promissory note was void, and the plaintiff failed to discharge the burden of explaining the alteration.

Issue (ii): Whether, after the promissory note became void for material alteration, the plaintiff could still recover the original consideration allegedly advanced.

Analysis: The Court held that the claim was founded on the promissory note itself, and the plaintiff had not pleaded an alternative case based on an independent loan transaction. Since the passing of consideration and execution of the note formed one transaction, the plaintiff could not fall back upon the original consideration once the instrument became void. The alleged admission of receipt of Rs. 400 did not amount to an admission of liability on a separate footing. Section 91 of the Indian Evidence Act, 1872 also supported the bar against proving consideration independently in the circumstances of the case.

Conclusion: The plaintiff could not recover Rs. 400 on the basis of original consideration.

Final Conclusion: The appeal failed in its entirety because the material alteration rendered the negotiable instrument unenforceable and no separate recoverable claim on the original transaction was made out.

Ratio Decidendi: A holder who sues on a negotiable instrument that appears materially altered must affirmatively explain the alteration, and if the alteration is not satisfactorily disproved, the instrument is void and cannot be enforced, nor can the claimant fall back on the same transaction as an independent claim unless such a case is separately established.

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