Summary
The Court restored decrees in two money-recovery suits where receipt of the plaintiff’s money was admitted but the defendants failed to establish discharge, business accounting or a gratuitous payment. Oral testimony of mediators did not prove full settlement on these banking transactions, and an affidavit unsigned by the plaintiff did not establish a gift. Section 70 supported restitution of the non-gratuitous benefit. The High Court’s reversals were set aside, appellate decrees restored, and costs of Rs.50,000 awarded; the plaintiff’s court deposit was directed to be released with accrued interest.
Issues
- Who bore the burden of proving full settlement or gratuitous payment once receipt of money was admitted.
- Whether the evidence sustained the defences to the two recovery suits.
Provisions considered
- Section 70, Indian Contract Act, 1872The failure to prove gratuitous payment attracted the obligation to compensate for or restore an enjoyed non-gratuitous benefit. (¶ 25-27)
Held
- On admitted receipt of money and repayment of only part, defendants pleading full and final settlement bore the burden of proving discharge. In these circumstances, involving banking transactions and alleged business dealings, the mediators’ oral accounts without a receipt or settlement record did not discharge that burden. (¶ 16-18)
- Even assuming the disputed transfers were authorised business investments, the defendants had to account for them. They produced no business books showing how the admitted receipts were absorbed or accounted for. (¶ 19-20)
- The affidavit relied on to establish payment out of love and affection lacked the plaintiff’s signature and conflicted with the subsequent alleged settlement of accounts. The gratuitous-payment defence was not proved. (¶ 21-24)
- Section 70 concerns obligations resembling contract arising from an accepted non-gratuitous benefit. With admitted receipt and neither discharge nor gratuitous character proved, the plaintiff was entitled to recover despite evidentiary discrepancies unrelated to the movement of the money. (¶ 25-27)
- Both first-appellate decrees were restored. The plaintiff was awarded Rs.50,000 in appeal costs, and her deposit made under the Supreme Court’s interim orders was to be released with accrued interest. (¶ 28)
Result
Appeals allowed; High Court decrees set aside and both first-appellate recovery decrees restored, with Rs.50,000 costs and release of plaintiff’s court deposit with accrued interest.