- 1 - HC-KAR NC: 2025:KHC:29087 RFA No. 2215 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 29TH DAY OF JULY, 2025 BEFORE THE HON'BLE MRS. JUSTICE K.S. HEMALEKHA REGULAR FIRST APPEAL NO. 2215 OF 2023 (MON) BETWEEN: 1. M/S. D.S.EXPORTS INTERNATIONAL, PARTNERSHIP FIRM, REPRESENTED BY PARTNERS, SRI. DHARMALINGAM AND SRI. SENDIL 2. DHARMALINGAM, PARTNER OF M/S. D.S.EXPORTS INTERNATIONAL, S/O. SRI. LAXMAN PERUMAL, AGED 54 YEARS, 3. SENDIL PARTNER OF M/S. D.S.EXPORTS INTERNATIONAL S/O. S.N.P.AMIRTHALINGAM AGED 50 YEARS ALL ARE R/AT OLD NO.14, NEW NO.29, RAMASWAMY STREET, MANNADY, CHENNAI-600001. …APPELLANTS (BY SRI. SRIPAL J.SANGHVI, ADVOCATE) AND: 1. M/S. PATHI SAREE SANGAM A REG. PARTNERSHIP FIRM, NO.555, 1ST FLOOR, SRI. VENKATESHWARA GOLD PLAZA, AVENUE ROAD, BENGALURU-560002 Digitally signed by MAHALAKSHMI B M Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:29087 RFA No. 2215 of 2023 REPRESENTED BY ITS PARTNER SRI. P.S.VISHWANATH S/O. SRI. P.A.SATHYANARAYANA AGED 68 YEARS …RESPONDENT THIS RFA IS FILED UNDER SECTION 96 R/W ORDER 41 RULE 1 OF CPC AGAINST THE JUDGMENT AND DECREE DATED 07.08.2023 PASSED IN OS NO.5468/2019 ON THE FILE OF XVII ADDITIONAL CITY CIVIL AND SESSIONS JUDGE, BENGALURU, DECREEING THE SUIT FOR RECOVERY OF MONEY. THIS RFA, COMING ON FOR ADMISSION, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MRS. JUSTICE K.S. HEMALEKHA ORAL JUDGMENT This Regular First Appeal is preferred by the defendants assailing the legality and correctness of the judgment and decree dated 07.08.2023 passed in OS No. 5468/2019 by the 17th Additional Civil Judge, Bengaluru CCH 16 (hereinafter referred to as ‘Trial Court’ for short). The Trial Court by the impugned judgment and decree decreed the suit in part filed by the plaintiff for recovery of money and held that the plaintiff is entitled for a sum of Rs.2,15,745/- against the appellants. - 3 - HC-KAR NC: 2025:KHC:29087 RFA No. 2215 of 2023 2. Heard the learned counsel appearing for the appellants. 3. Learned counsel appearing for the appellants contended that the suit filed by the plaintiff is barred by limitation, as the transaction allegedly took place in early 2015 and the suit was filed only in 2019. According to the appellants the documents relied upon by the plaintiff was fabricated and manipulated to bring the suit within limitation. It is argued that the entire transaction concluded with the refund of the remaining amount of Rs.2,05,745/- on 20.01.2015 and hence there was no subsisting cause of action for the plaintiff to institute the suit. 4. Brief facts : - The plaintiff is a registered partnership firm carrying on business in the sale of silk sarees. The defendant No. 1 is a partnership firm known as M/s D.S. Exports International and defendant Nos. 2 and 3 are its partners. On 10.01.2015 the defendants requested the plaintiff to supply silk sarees worth Rs.4,15,745/-. The plaintiff agreed and raised an - 4 - HC-KAR NC: 2025:KHC:29087 RFA No. 2215 of 2023 invoice dated 10.01.2015, stipulating that the said amount would carry interest at the rate of 24% p.a until repayment. The defendants took delivery of the goods and acknowledged the invoice. The remaining amount of Rs.2,10,745/- has not been paid. The three cheques issued by the defendants when presented by plaintiff to the Bank was returned with endorsement ‘funds insufficient’. It is averred that defendants made payments on 07.11.2015 for a sum of Rs.1,25,000/-, on 27.06.2016 for a sum of Rs.40,000/- and 25.07.2016 for a sum of Rs.40,000/- totaling to Rs.2,05,000/-. Despite repeated requests the balance amount of Rs.2,10,745/- remained unpaid. A legal notice was issued on 05.03.2019 demanding payment. The defendants replied on 18.03.2019 denying the liability. Hence the plaintiff instituted the suit for recovery of the outstanding amount with interest. 5. The defendants contended that they had paid a sum of Rs.2,10,000/- in cash towards the goods purchased on 10.01.2015 and subsequently returned the goods to the plaintiff. It is claimed that the cheques were issued only as a - 5 - HC-KAR NC: 2025:KHC:29087 RFA No. 2215 of 2023 security measure and not towards any outstanding liability. The defendants further asserted that the remaining amount of Rs. 2,05,745/- was refunded on 20.01.2015 and the entire transaction between the plaintiff and the defendants stood concluded. Accordingly it is contended that no amount is due or recoverable from the defendants. The defendants also raised a contention that the suit is barred by limitation having filed beyond the prescribed period of limitation. 6. The Trial Court after analyzing the material evidence held that the plaintiff is entitled to a sum of Rs.2,15,745/- against the defendants. It observed that the last admitted payment of Rs.40,000/- was made by the defendants on 25.07.2016, and the suit came to be filed on 25.07.2019, which is within 3 years period prescribed under the Limitation Act. The Trial Court placed reliance upon the decision of the coordinate Bench of this court in Dr. Y. Nagappa vs Shanmukha Gowda and Others1 1 ILR 2005 KAr 1687 - 6 - HC-KAR NC: 2025:KHC:29087 RFA No. 2215 of 2023 (D.Y.Nagappa) to conclude that the suit was filed within time and decreed the suit for Rs.2,15,745/- with accrued interest. 7. Upon appreciation of the pleadings, evidence and the contentions advanced, the point that arises for consideration is, “whether the judgment and decree of the Trial Court warrants any interference by this Court”. 8. It is an admitted fact that the value of the silk sarees supplied under invoice dated 10.01.2015-Exhibit P1 was Rs.4,15,745/-. According to the defendants they had paid a sum of Rs.2,05,745/- on 20.01.2015 and had returned the goods to the plaintiff and the entire transaction was completed. Exhibits P3, P5 and P7 are the cheques issued by the defendants and the corresponding bank memos are at Exhibits P4, P6 and P8, which indicates that the cheques were returned for insufficient funds. The issuance of these cheques demonstrates acknowledgment of the liability by the defendants. The last payment of Rs. 40,000/- was made by the defendants on 25.07.2016, which is clearly admitted by the appellants/defendants themselves. - 7 - HC-KAR NC: 2025:KHC:29087 RFA No. 2215 of 2023 The suit is filed on 25.07.2019 and it is therefore within time. Even if the limitation period is computed from 25.07.2016, the exclusion of that day under Section 12(1) of the Limitation Act affirms that the filing on 25.07.2019 is within the permissible 3 years period. The Trial Court rightly considered this aspect by placing reliance upon the decision of the Co-ordinate Bench in the case of Dr. Y. Nagappa stated supra. The three dishonoured cheques-Exhibits P3, P5 and P7 are issued after the invoice date and part payment, and their presentation and dishonour at Exhibits P4, P6 and P8 support the inference that the cheques are issued in discharge of a legally enforceable debt, not merely for security. The appellants have failed to produce any rebuttal evidence to this presumption. The defence made out by the defendants that the goods were returned and full amount is settled is unsupported by any documentary or reliable oral documents. On the contrary, the plaintiff has produced the invoice-Exhibit P1, the cheque details, bank memos and part payment records, all of which establish continuity of the debt. The Trial Court, upon appreciation of the entire oral - 8 - HC-KAR NC: 2025:KHC:29087 RFA No. 2215 of 2023 and documentary evidence, has rightly decreed the suit of the plaintiff for recovery of money. 9. For the foregoing reasons, the point framed for consideration is answered and accordingly, this Court pass the following: ORDER i. The Regular First Appeal is hereby dismissed. ii. The judgment and decree of the Trial Court stands confirmed. Sd/- ____________________ JUSTICE K.S. HEMALEKHA CKL List No.: 1 Sl No.: 18