SA/827/2012 of Model Chit Corporation Limited, Vs Aligiredy Yugandeer Reddy on 31 December 2012

JUDGMENT:

The plaintiff is the appellant in this second appeal. The plaintiff is a chit fund company. The plaintiff filed suit inthe trial Court for recovery of Rs.27,280/- towards the amountdue under the chit transaction in which the first defendant isthe prized subscriber and the defendants 2 to 4 areguarantors for the first defendant. Out of Rs.27,280/- which isthe suit claim, Rs.20,000/- is the principal amount due. Thefirst defendant pleaded discharge. The defendants 2 to 4remained exparte. After trial, the trial Court decreed the suit.

On appeal by the first defendant, the lower appellate Courtreversed the decree granted by the trial Court. It lead theplaintiff to approach this Court with this second appeal.

2) In this second appeal, it is contended by the appellant’s counsel that in total, the first defendant becameliable under 4 chit transactions to the extent of Rs.1,20,000/-and that the settlement between the parties beforepermanent Lok Adalat covered by Ex.B-6 award is only inrespect of 1 cheque for Rs.21,000/- issued towards partialdischarge of the total amount under 4 chit transactions.

3) Under Ex.B-6 award, the chit fund company andthe 1[st] defendant compromised the dispute relating tobouncing of cheque issued by the first defendant forRs.21,000/- and the resultant offence under Section 138 ofthe Negotiable Instruments Act, 1881. Ex.B-3 is the legalnotice issued by the chit fund company to the first defendantafter bouncing of the said cheque. Subsequent to Ex.B-3notice, the plaintiff Company filed private complaint in criminalCourt against the 1[st] defendant for the offence under section138 of the Negotiable Instruments Act, 1881. The saidcriminal case filed for dishonour of the said cheque, wascompounded under Ex.B-6 by the first defendant on making payment of Rs.20,000/- to the plaintiff-Company which wasthe complainant in the criminal case. Ex.B-3 legal noticespecifically avers that the said cheque for Rs.21,000/- wasissued towards discharge of the first defendant’s liabilityunder the chit transaction bearing No.MT2VW-29. The suit inthe trial Court was also instituted for recovery of balanceamount payable in the same chit transaction No.MT2VW-29. When the first defendant paid Rs.20,000/- under Ex.B-6award before permanent Lok Adalat towards discharge of thisliability under chit No.MT2VW-29, the plaintiff cannot file thesuit once again for recovery of chit liability which wasdischarged. The lower appellate Court rightly reversed thedecree granted by the trial Court. I find no error or legal errorcommitted by the lower appellate Court and I find nosubstantial question of law for decision in this second appeal.

4) In the result, the second appeal is dismissed.

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SAMUDRALA GOVINDARAJULU,JDt.31[st] December, 2012ksh