TaxTMI 
TaxTMI 
TaxTMI 
2025 (6) TMI 835
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.... discharge of the said sum, he had issued a cheque dated 24.04.2008. When the cheque was presented for collection, the same got dishonoured. Accordingly Rs.6,89,000/- with future interest was claimed. 5. Defendant filed written statement admitting that he borrowed an amount of Rs.5 lakh from the plaintiff agreeing to pay interest at the rate of 6% per annum. At the time of borrowing the said sum, two blank signed cheque leafs were given to the plaintiff on 24.03.2008, the date of borrowing the amount. According to the defendant, out of the total sum of Rs.5 lakh as per cheque dated 02.04.2008 drawn on the Indian Bank, Balaramapuram Branch Rs.2 lakh was repaid. 6. The trial court raised necessary issues and tried the matter. PW1 and PW2 examined and Exts.A1 and A2 marked on the side of the plaintiff. DW1 and DW2 examined and Exts.B1 and B2 marked on the side of the defendant. Exts.X1 also marked through PW2. 7. On analysis of evidence, the trial court decreed the suit allowing the plaintiff to realise Rs.6,89,000/- with interest at the rate of 9% per annum on the principal sum of Rs.6,50,000/- from the date of suit till realisation from the defendant and his assets. 8. While ass....
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....ed reading of Sections 5 and 6 of the Negotiable Instruments Act would make it clear that an instrument would be a cheque if only it contains the particulars as mentioned in the two sections referred to above. If drawee's name is not written in the instrument, that instrument cannot be termed to be a bill of exchange. Therefore, if it is only a signed blank cheque leaf, it cannot be said to be a cheque within the meaning of Section 6 of the Negotiable Instruments Act. 12. In view of the rival submissions, the points arise for consideration are; (1) Whether the trial court was justified in holding that the plaintiff proved the transaction for Rs.6,50,000/- that led to the execution of Ext.A1 cheque? (2) Whether the trial court went wrong in not considering the payment of Rs.2 lakh as adjustment towards the debt in view of Ext.B2 cheque, which was admitted by the plaintiff? (3) What is the rate of interest payable in a suit for money based on a negotiable instrument when the instrument doesn't specify the interest? (4) How Section 80 of the NI Act and Section 34 of the Code of Civil Procedure would operate? (5) Whether the decree and judgment would require interfer....
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....arest shop owners. In the instant case, the plaintiff never disclosed any other transaction between the plaintiff and defendant apart from the present one averred in the plaint, till the stage of his cross-examination. The case of the plaintiff is that defendant borrowed Rs.6,50,000/- on 24.03.2008 and he failed to return the same though he issued Ext.A1 cheque to discharge the said liability. As per Ext.B2 evidently and admittedly, the plaintiff received Rs.2 lakh on 02.04.2008 after the present transaction. Apart from answering a query during cross-examination that Ext.B2 cheque amount was received for a different transaction on 10.02.2008, such a previous transaction in no way either pleaded or proved. Therefore, the available evidence would suggest that the plaintiff received Rs.2 lakh out of Rs.6,50,000/- borrowed from the defendant on 24.03.2008 and the said amount to be adjusted and reduced for Rs.6,50,000/-. Therefore, the plaintiff is entitled to get Rs.4,50,000/- alone as the amount due to him in this transaction. 17. In view of the said finding, the decree and judgment of the trial court is interfered and modified to the tune of Rs.4,50,000/- instead of Rs.6,50,000/- al....
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.... is silent with respect to the payment of further interest on such principal sum from the date of the decree to the date of payment or other earlier date, the Court shall be deemed to have refused such interest, and a separate suit therefore shall not lie. 21. Section 80 of NI Act provides as under; 80. Interest when no rate specified.- When no rate of interest is specified in the instrument, interest on the amount due thereon shall, notwithstanding any agreement relating to interest between any parties to the instrument, be calculated at the rate of eighteen per centum per annum, from the date at which the same ought to have been paid by the party charged, until tender or realization of the amount due thereon, or until such date after the institution of a suit to recover such amount as the Court directs. Explanation.-When the party charged is the indorser of an instrument dishonoured by non- payment, he is liable to pay interest only from the time that he receives notice of the dishonour. 22. It is true that, as per Section 34 of C.P.C. insofar as a decree is for the payment of money, in the decree, the court can order interest at such rate as the Court deems reasonable to ....
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....as enhanced to eighteen per centum from six per centum. It is the settled law that the provisions of special law would prevail over the general law. Similarly, a special provision would override a general provision. Therefore, in a suit based on negotiable instrument, grant of interest shall be at the rate of eighteen per centum per annum, as provided under Section 80 of the NI Act. In such view of the matter, in deviation from the general prescription regarding grant of interest in a decree for payment of money based on documents other than negotiable instrument, as provided under Section 34 of C.P.C., the court has the power to grant interest at eighteen per centum, in tune with the mandate of Section 80 of the NI Act. Thus the law is clear on the point that in a decree for payment of money based on documents other than a negotiable instrument, Section 34 would govern grant of interest and in decree for payment of money based on a negotiable instrument, the interest on the amount due shall be governed by Section 80 of the NI Act, notwithstanding any interest relating to the interest between any parties to the instrument. 26. In the instant case, the trial court granted only 9% i....