Kerala High Court
M/S. Gisa International vs Sophie Ceevi on 20 July, 2026
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RFA Nos.170/2017 & 263/2017 (1)
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE MOHAMMED NIAS C.P.
MONDAY, THE 20TH DAY OF JULY 2026 / 29TH ASHADHA, 1948
RFA NO. 170 OF 2017
AGAINST THE JUDGMENT AND DECREE DATED IN OS NO.468 OF 2009 OF
ASSISTANT SESSIONS COURT/I ADDITIONAL SUB COURT,ERNAKULAM
APPELLANTS/DEFENDANTS:
1 M/S. GISA INTERNATIONAL
GISA BHAVAN, OPPOSITE PONEL CHURCH, PONEKKARA,ELAMAKKARA P.O,
COCHIN - 682 026.REPRESENTED BY ITS MANAGING PARTNER SADHANA
GILBERT.
2 MRS. SADHANA GILBERT
MANAGING PARTNER M/S. GISA INTERNATIONAL, AGED 46 YEARS,
W/O. GILBERT M, ANTONY (M.A GILBERT)MALIYEKKAL HOUSE, GISA
BHAVAN, OPPOSITE PONEL CHURCH,PONEKKARA, ELAMAKKARA P.O, COCHIN
- 682 026.
3 GILBERT M. ANTONY (M.A GILBERT)
AGED 49 YEARS, S/O. ANTONY, MALIYEKKAL HOUSE, GISA BHAVAN,
OPPOSITE PONEL CHURCH, PONEKKARA, ELAMAKKARA P.O, COCHIN - 682
026.
4 SEBASTIAN @ ACHAYAN(DIED)
AGED 50 YEARS, MALIYEKKAL HOUSE, GISA BHAVAN, OPPOSITE PONEL
CHURCH PONEKKARA, ELAMAKKARA P.O, COCHIN - 682 026.
BY ADVS.
SRI.P.MARTIN JOSE
SHRI.K.S.ARUN KUMAR
SRI.JUSTINE JACOB
SMT.RESMI THOMAS
RESPONDENT/PLAINTIFF/ADDL. RESPONDENTS 2 TO 9:
1 SOPHIE CEEVI
AGED 35 YEARS, W/O. C.P. CEEVI, CHOWARAN HOUSE, MATOOR,KALADY
PIN - 683574 ERNAKULAM DISTRICT, KALADY PANCHAYATH
MATTOOR VILLAGE.
ADDL.R2 SALIMA,
D/O.DEVASSIA, AGED ABOUT 72 YEARS, PUNNASSERY HOUSE,
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PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R3 LISSAMMA,
D/O.DEVASSIA, AGED ABOUT 70 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R4 ROSAMMA,
D/O.DEVASSIA, AGED ABOUT 66 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R5 KOCHURANI,
D/O.DEVASSIA, AGED ABOUT 60 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R6 SOOSAMMA
D/O.DEVASSIA, AGED ABOUT 58 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R7 ALFY,
D/O.DEVASSIA, AGED ABOUT 54 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R8 KOCHUMOL,
D/O.DEVASSIA, AGED ABOUT 50 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R9 JOSEKUTTY
S/O.DEVASSIA, AGED ABOUT 62 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504.
ADDITIONAL RESPONDENT NOS.2 TO 9 ARE BEING IMPLEADED AS LEGAL
REPRESENTATIVES OF DECEASED APPLICANT/APPELLANT NO.4 , VIDE
ORDER DATED 15.09.2025 IN IA NO.1/2025 IN MJC NO.43/2025 IN
RFA NO.170/2017.
BY ADVS.
SHRI.BIJU K.C.
SRI.MATHEW KURIAKOSE
THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 02.07.2026,
ALONG WITH RFA.263/2017, THE COURT ON 20.7.2026 DELIVERED THE FOLLOWING:
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RFA Nos.170/2017 & 263/2017 (3)
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR.JUSTICE MOHAMMED NIAS C.P.
MONDAY, THE 20TH DAY OF JULY 2026 / 29TH ASHADHA, 1948
RFA NO. 263 OF 2017
AGAINST THE JUDGMENT AND DECREE DATED 23.12.2015 IN OS NO.528 OF
2009 OF I ADDITIONAL SUB COURT,ERNAKULAM
APPELLANTS/DEFENDANTS:
1 M/S.GISA INTERNATIONAL
GISA BHAVAN,OPPOSITE PONEL CHURCH,PONEKKARA, ELAMAKKARA
P.O.COCHIN-682026, REPRESENTED BY ITS MANAGING PARTNER SADHANA
GILBERT.
2 MRS. SADHANA GILBERT
MANAGING PARTNER,M/S.GISA INTERNATIONAL, AGED 46 YEARS,W/O
GILBERT M.ANTONY (M.A.GILBERT)MALIYEKKAL HOUSE, GISA BHAVAN,
OPPOSITE PONEL CHURCH, PONEKKARA, ELAMAKKARA
P.O.,COCHIN-682026
3 GILBERT M.ANTONY (M.A.GILBERT)
AGED 49 YEARS,S/O ANTONY, MALIYEKKAL HOUSE, GISA
BHAVAN,OPPOSITE PONEL CHURCH,PONEKKARA, ELAMAKKARA
P.O.COCHIN-682026
4 SEBASTIAN @ ACHAYAN(DIED)
AGED 50 YEARS,MALIYEKKAL HOUSE, GISA BHAVAN,OPPOSITE PONEL
CHURCH,PONEKKARA, ELAMAKKARA P.O.COCHIN-682026
BY ADVS.
SRI.P.MARTIN JOSE
SHRI.K.S.ARUN KUMAR
SRI.JUSTINE JACOB
SMT.RESMI THOMAS
RESPONDENT/PLAINTIFF/ADDL. RESPONDENTS 2 TO 9::
1 JINCY JOSEPH
AGED 33 YEARS,W/O BENNY GEORGE,PULIKKAL HOUSE, THIRUVAMPADY
P.O.PASHUTHURUTHU, VAIKOM TALUK, KADUTHURUTHY, KOTTAYAM
DISTRICT. PIN-686612.
ADDL.R2 SALIMA
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AGED 72 YEARS
D/O.DEVASSIA, AGED ABOUT 72 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R3 LISSAMMA,
AGED 70 YEARS
D/O.DEVASSIA, AGED ABOUT 70 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R4 ROSAMMA,
AGED 66 YEARS
D/O.DEVASSIA, AGED ABOUT 66 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R5 KOCHURANI
AGED 60 YEARS
D/O.DEVASSIA, AGED ABOUT 60 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R6 SOOSAMMA
AGED 58 YEARS
D/O.DEVASSIA, AGED ABOUT 58 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R7 ALFY,
AGED 54 YEARS
D/O.DEVASSIA, AGED ABOUT 54 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R8 KOCHUMOL,
AGED 50 YEARS
D/O.DEVASSIA, AGED ABOUT 50 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504
ADDL.R9 JOSEKUTTY,
AGED 62 YEARS
S/O.DEVASSIA, AGED ABOUT 62 YEARS, PUNNASSERY HOUSE,
PUNNAKUNNAM, PULINCUNNU P.O, ALAPPUZHA DISTRICT, PIN-688504.
ADDITIONAL RESPONDENT NOS.2 TO 9 ARE BEING IMPLEADED AS LEGAL
REPRESENTATIVES OF DECEASED APPLICANT/APPELLANT NO.4 , VIDE
ORDER DATED 15.09.2025 IN IA NO.1/2025 IN MJC NO.31/2025 IN
RFA NO.263/2017.
THIS REGULAR FIRST APPEAL HAVING BEEN FINALLY HEARD ON 02.07.2026,
ALONG WITH RFA.170/2017, THE COURT ON 20.7.2026 DELIVERED THE FOLLOWING:
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RFA Nos.170/2017 & 263/2017 (5)
MOHAMMED NIAS C.P., J.
.................................................................
RFA 170 & 263 of 2017
..................................................................
Dated this the 20th day of July, 2026
JUDGMENT
R.F.A. Nos. 170 and 263 of 2017 arise out of O.S. Nos. 468 of 2009 and 528 of
2009, respectively, which were disposed of by the common judgment and
decrees dated 23.12.2015 passed by the Court of the Sub Judge, Ernakulam. The
plaintiffs in the suits are the respondents, and the defendants are the
appellants in these appeals. Since both suits arose out of substantially the same
transaction, involved common questions of fact and law, and were jointly tried
and disposed of by a common judgment, these appeals are also being
considered together.
2. O.S. No.468 of 2009 was instituted by the plaintiff for recovery of
Rs.2,98,625/- with interest. The plaintiff alleged that pursuant to Ext.A3 dated
10.04.2007, preliminary confirmation of employment issued by Global
Employment Consultancy (GEC), she paid Rs.50,000/- to the defendants towards
service charges and thereafter, on 19.07.2007, remitted Rs.2,48,625/- to the
joint account of defendants 2 and 3, as directed by the defendants, for securing
employment abroad, as evidenced by Ext.A6, counter foil issued by Federal
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Bank Ltd. According to the plaintiff, the promised employment did not
materialise, and GEC was only a sham entity floated by the defendants for
collecting money from job aspirants. It was therefore contended that the
defendants were liable to refund the amounts received from her.
3. O.S. No.528 of 2009, from which R.F.A. No.263 of 2017 arises, was
filed by the plaintiff seeking recovery of Rs. 3,76,800/- with interest. According
to the plaintiff, pursuant to the preliminary confirmation of employment
issued by GEC, she paid Rs. 50,000/- towards service charges and thereafter
remitted a total amount of Rs. 2,52,668/-, as evidenced by the corporate receipt
issued by GEC, besides other amounts as directed by the defendants. It was
alleged that when the promised employment did not materialise, the parties
arrived at a settlement and the defendants issued a cheque dated 05.04.2009 for
Rs. 3,76,800/- towards full and final settlement. The cheque, when presented
for collection, was dishonoured with the endorsement “Account Blocked”,
giving rise to the suit.
4. The defendants filed a common written statement in both suits,
contending that the first defendant acted only as an authorised agent of Global
Employment Consultancy (GEC) and that GEC was the principal and a necessary
party to the suits. According to the defendants, they had received only
Rs.50,000/- towards service charges, and all other amounts were directly
remitted by the plaintiffs to GEC. They further contended that they were not
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personally liable in view of Section 230 of the Indian Contract Act. In O.S.
No.528 of 2009, while admitting the cheque, it was contended that the same had
been obtained through coercion and threat with the intervention of the police
when the defendants were in judicial custody, and that there was no voluntary
settlement or legally enforceable liability. The defendants also disputed the
status of the first defendant as a partnership firm and denied the liability of the
fourth defendant as a partner.
5. The suits were jointly tried, taking O.S. No.468 of 2009 as the
leading case. The trial court framed the following common issues for
consideration:
(i) Whether the defendants had offered employment to the plaintiffs?
(ii) Whether the plaintiff is entitled to recover any amount from the defendant?
(iii) Whether the decree of money as sought for is allowed?
(iv) Relief and costs?
6. On the side of the plaintiffs, PW1 was examined in O.S. No.468 of
2009 and PW2 in O.S. No.528 of 2009 and Exts.A1 to A16 were marked. On the
side of the defendants, DW1 was examined in O.S. No.468 of 2009 and DW2 in
O.S. No.528 of 2009.
7. The learned counsel for the appellants, Sri. Martin Jose argues that
the defendants acted only as agents to facilitate the plaintiffs’ attempt to secure
employment abroad and collected only a service charge. All the other amounts
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were admittedly paid by the plaintiffs directly to GEC. The plaintiffs obtained
the cheque from the police, who took them from the defendants under threat
and duress, and they were presented when defendants 2 and 3 were in jail
between 26.02.2009 and 12.05.2009. The plaint is totally silent as to who gave
the cheque, what was the nature of the settlement, how the amounts were
quantified, or even the date of issuance of the cheque. Except for the self-
serving evidence of the plaintiffs, there is nothing on record to substantiate
their contentions.
8. It is argued that only the signature on the cheque was admitted, but
denying the execution, and therefore, no presumption under the Negotiable
Instruments Act would apply. The learned counsel also relied on the provisions
of Section 118(2), Section 46, 47, and 50 of the Negotiable Instruments Act in
support of his contentions. It is further argued that, as the privity of contract
was between the plaintiffs and the principal, GEC was a necessary party to the
suits.
9. Learned counsel also argues, based on Section 230 of the Contract
Act, that the claim ought to have been made against the principal for the
payments made directly to them and for which corporate receipts were
admittedly issued, and thus no claim could have been made against the
appellants.
10. It is also argued that Defendant No. 4 was impleaded, alleging that
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he was a partner and that his property was attached, which was in fact sold by
the other defendants long before the suit. It is also argued that Defendant No. 4
was never a partner of the firm. It is further argued that the power of attorney
holder was examined in O.S. 528/2009. The learned counsel relied on the
judgment in Janki Vashdeo v. IndusInd Bank [2005 KHC 573] to argue that
the evidence led by the power of attorney holder cannot be accepted, and only
for matters for which the power of attorney was granted, and where they had
direct knowledge, their evidence will be relevant. Their evidence, therefore,
cannot be treated as admissible or relevant. It is also argued that no cheque was
issued in O.S No. 468/2009 from which RFA 170/2017 arises. However, a cheque
was issued in O.S. 528/2009 from which RFA 263/2017 arises.
11. It is also argued based on the judgments in Premshanker v. I.G.
of Police [2002 KHC 792] and Seth Ramdayal Jat v. Laxmi Prasad [2009 KHC
483] as well as the provisions of Sections 40 to 43 of the Evidence Act, that even
a judgment of a criminal court will not be binding or conclusive and therefore
the charge sheet in a case filed by an Investigating Officer is nothing but an
opinion and cannot be treated as an admissible piece of evidence. He also
relied on the judgments in Khushalbhai Mahijibhai Patel v. A. firm of
Mohammadhussain Rahimbux [1980 KHC 449] and James Machintosh and
Co. Pvt. Ltd. v. Shree Yamuna Milk Co. Ltd. [1990 KHC 365] to support his
contentions.
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12. Opposing the contentions of the appellants, the learned counsel
for the respondents, Sri. Biju K. Chacko argues that they specifically pleaded
that the defendants 1 to 3 were misrepresenting themselves as the agents of
GEC. In fact, the evidence showed that there was no agency and that GEC was a
sham company. The advertisement leading to the payments by the plaintiff was
in the year 2004, and after amassing wealth, they purchased several properties
in 2006. All these facts were clearly proved in the investigation conducted by
the CBI pursuant to the directions issued by this court in a writ petition.
Though GEC was impleaded as the additional 5 th respondent, notice could not
be served, and after the filing of the charge sheet, which said that there was no
such entity in existence, an application was filed to delete them from the party
array. Accordingly, no plea of non-joinder of a necessary party will arise in the
instant case.
13. It is also argued that the address of GEC shown in the exhibits
varies, and even the details given are completely inaccurate and incomplete;
that it was not possible to get the identity of the principal, and therefore,
Section 230 cannot apply. The cross-examination of the second defendant
clearly showed that, although they claimed to be the authorised agent of GEC,
no documents were produced, and defendant No. 2 was completely ignorant of
even the constitution of GEC. There were no documents produced to show the
relationship between defendants Nos. 1 to 3 and GEC. It is also argued that the
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bank’s SWIFT messages handed over by the second defendant showed a
Bangkok address, whereas the corporate receipts, which were issued for the
payments made by the plaintiff, showed GEC as functioning in the USA, Canada,
and the Netherlands without any address. Relying on the decisions in
Aramukhan Nayadi v. Chandu Kunhiraman [1957 KHC 212], Midland
Overseas v. M.v. “CMBT Tana” and others [1999 KHC 3003], Nagnath
Kaulwar and sons v. M/s. Govindram Shyamsunder [2004 KHC 3371], and
Cochin Frozen Food Exports (P) Ltd. v. Vanchinad Agencies and others
[2004 KHC 1975], it is argued that Section 230 will have no application in a case
where there is non-disclosure of the principal, and also because the charge
sheet proved that there was no such entity in existence.
14. The specific contention of the plaintiff was that there was a
promise to return the money if the job offered was not materialised, and
therefore the cheque was given to the plaintiff in RFA 263/2017. It is also
submitted that A1 showed the defendant as a managing partner, which shows
the existence of a firm. It is also argued that in OS 468/2009, the plaintiff had
directly paid into the account of D2 and D3, and therefore, there was no cheque
issued to them. This also shows that payments were being taken by defendants
1 and 2 on the promise of getting employment abroad. As regards the
presumption, the learned counsel relies on the judgment in Neeraj Dutta v.
State (Govt. of NCT of Delhi) [2022 (7) KHC 647].
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15. As regards the execution of the cheque, the pleadings as well as
the evidence on behalf of the plaintiffs clearly showed who issued the cheque
and who signed the cheque. It is also argued that the plaint alleged that a
settlement was arrived at based on which the cheque was issued to the plaintiff
in OS No. 263/2017. The proof affidavit also stated the same. It was specifically
alleged that the third defendant had issued the cheque. The suggestion to the
plaintiff by the defendants was that the Circle Inspector of Police, Kalamassery,
coerced the plaintiff, and the cheque had to be given, which was denied. As a
matter of fact, the cheque on presentation was not honoured, stating that the
account was blocked.
16. The learned counsel points out that the evidence of the defendant
shows that when she was in hospital, the police took the cheque, and therefore,
there is no contention that the cheque was taken when she was in jail, and this
admission clearly goes against the pleading in the appeal itself. The evidence
would further show that the cheques were not issued when the defendants
were allegedly in jail.
17. It is further argued that there was no document at all to show the
period of detention or the detention itself. The inconsistencies in the pleadings
in the written statement and the evidence of the defendant would clearly prove
this. Thus, it is submitted that there was no consistent case at all regarding the
issuance of the cheque. The case that the police threatened and they had to give
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away the cheques cannot be accepted, as no complaint whatsoever was given,
and no material was produced to substantiate their contention that a complaint
was given to the City Police Commissioner. Since the foundational facts
required for proving the execution of the negotiable instrument stand proved,
the presumption under the N.I. Act also applies. Learned counsel also points out
that at some places the case of the defendants was that a signed cheque was
taken by the police, whereas they had another version where they said blank
cheques were taken by the police. Learned counsel also relies on the judgment
in Dr Jyothi Prasad Bhat v. Sundara Rajan & another [2013 (3) KHC 141],
where a similar contention that the cheque was forcefully taken by the police
was considered.
18. The learned counsel for the appellants, in reply, submits that
there is no attempt to implead GEC even after furnishing the full address.
Though an application was filed to implead GEC, and the same was allowed, GEC
could not be served. However, after the defendants furnished the correct
address, no steps were taken to implead GEC. It is also argued that no
evidentiary value can be placed on a final report relying on the judgment in
Rajesh Yadav & another etc. v. State of U.P. [MANU/SC/0158/2022]. It is the
plaintiffs who pleaded a partnership, and therefore, they ought to have given
some proof regarding the partnership between D1 and D4. As to the issuance of
the cheque, there is no evidence other than the interested testimony of the
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plaintiffs, while the defendants clearly showed the circumstances in which the
cheque was taken by the plaintiffs. It is argued that there was no legally
enforceable debt for which a cheque had been given. It is also argued that the
decree against the 4th defendant was totally wrong, as there is no proof to show
that he was a partner, and the sale of the property to him was long before the
suit.
19. The point for determination is whether the appellants in RFA
263/2017 had executed the cheque in question and whether the appellants have
the liability to pay the amounts claimed to the respondents/plaintiffs in both
cases.
20. I have considered the rival submissions and perused the records.
21. The principal contention of the appellants is that they were only
agents of Global Employment Consultancy (GEC) and that, except for the service
charges, all other amounts were paid directly by the plaintiffs to GEC, and as
such, no liability can be fastened upon the appellants, and that GEC was a
necessary party to the suits. This contention cannot be accepted for more than
one reason. It is to be noted that the defendants 1 to 3 had admitted in the reply
notice that they are the sole authorised agents in Kerala by GEC. It is also to be
noted that the amounts were transferred to GEC only on the instructions issued
by defendants 1 to 3. The evidence of PWs 1 and 2, read along with the
connected documents, clearly establishes that the plaintiffs approached only
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the defendants, based on their representation, paid the service charges to
them, obtained the preliminary employment confirmations through them, and
transferred the balance amounts only because of the directions issued by them.
There is absolutely no material to show that the plaintiffs had any independent
dealings with GEC.
22. The pleadings themselves disclose that the plaintiffs had
specifically alleged that GEC was only a sham entity projected by defendants 1
to 3 and that the defendants themselves were the real beneficiaries of the
transactions. Though the defendants consistently claimed to be authorised
agents of GEC, they failed to produce any agreement of agency, authorisation,
or any document establishing the legal existence or constitution of GEC. The
cross-examination of the defendant further demonstrates that he was unable to
furnish even the basic particulars regarding the constitution of GEC. The
different addresses shown for GEC in the corporate receipts and the SWIFT
documents also support the plaintiffs’ contention that GEC was not a genuinely
disclosed principal.
23. Even if GEC was a genuine entity, the liability of the defendants
stands independently established by the oral and documentary evidence on
record. Significantly, in O.S. No.468 of 2009 (R.F.A. No.170 of 2017), a substantial
part of the payments was made directly to defendants 2 and 3, as evidenced by
Ext.A6. This circumstance further demonstrates that the defendants themselves
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were direct recipients of the plaintiffs’ money and cannot avoid personal
liability by merely projecting GEC as the principal.
24. As regards the argument based on Section 230 of the Contract Act,
it is relevant to note that no documents were produced by defendants 1 to 3
giving the full address of the alleged principal. There is no case that, apart
from transferring the amounts to GEC as directed by defendants 1 to 3, of
course, after the issuance of a letter of confirmation, there was any
correspondence between the plaintiffs and GEC. In such circumstances, they
cannot invoke the protection available under Section 230 of the Indian Contract
Act. The principle that emerges is that where the principal is undisclosed, not
properly identified, or incapable of being sued, the agent incurs personal
liability. Equally, a contracting party cannot be expected to repose exclusive
reliance on a foreign principal whose identity has not been properly disclosed
or whose legal existence cannot be verified. It is only where the principal is
disclosed and capable of being impleaded that the agent ordinarily escapes
personal liability. Conversely, where the principal is not disclosed, is non-
existent, or otherwise cannot be proceeded against, the liability falls upon the
agent who entered into the transaction. In the present case, the defendants
have failed to disclose the identity of the alleged principal in a manner known
to the law, and the materials on record do not establish that GEC was a legal
entity capable of being sued. The defendants are, therefore, not entitled to
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claim the protection under Section 230 of the Indian Contract Act. (See:
Aramukhan Nayadi v. Chandu Kunhiraman [1957 KHC 212], James
Machintosh and Co. Pvt. Ltd. v. Shree Yamuna Milk Co. Ltd. [1990 KHC
365], Midland Overseas v. M.V. “CMBT Tana” and others [1999 KHC 3003],
Nagnath Kaulwar and Sons v. M/s. Govindram Shyamsunder [2004 KHC
3371], Cochin Frozen Food Exports (P) Ltd. v. Vanchinad Agencies and
others [2004 KHC 1975] and Link International and another v. Mandya
National Paper Mills Ltd. [2004 KHC 1454]).
25. It is also significant that though GEC was initially impleaded as an
additional party, notice could not be served, and, thereafter, the investigation
disclosed that no such entity was traceable. The varying addresses shown in the
records and the complete absence of any material establishing the legal
identity of GEC reinforce the conclusion that the alleged principal was never
properly disclosed. The defendants also failed to produce any document
evidencing their relationship with GEC. Consequently, the plea based on
non‑joinder of GEC is wholly untenable.
26. Even otherwise, Section 28 of the Negotiable Instruments Act also
answers the contention of the appellants. In Sivagurunatha Pillai v.
Padmavathi Ammal and another [AIR 1941 Mad 417 (FB)], the Full Bench
held that the liability under Section 28 has to be determined from the
instrument itself and that the Court cannot look beyond the negotiable
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instrument to ascertain whether the maker intended to exclude personal
liability. The same principle was reiterated in M. Mahadevan Pillai v.
Vedavalli Ammal [1991 SCC OnLine Mad 223], wherein it was held that an
agent who signs a promissory note, bill of exchange, or cheque without
indicating therein that he signs as an agent or that he does not intend to incur
personal responsibility is personally liable on the instrument. It was further
held that mere knowledge on the part of the holder that the executant was
acting as an agent does not absolve the executant of personal liability, and that
the only exception under Section 28 is where the holder induced the maker to
sign on the belief that the principal alone would be liable, which must be
specifically pleaded and proved. In the present case, the disputed cheque do not
indicate that the defendants signed them merely as agents of GEC or that they
intended to exclude personal liability. There is also no pleading or evidence
that the plaintiffs induced the defendants to sign the cheque on the
understanding that only GEC would be liable. Therefore, even assuming that the
defendants were acting as agents of GEC, they cannot avoid personal liability on
the cheque.
27. The specific case of the defendants is that the cheque has been
issued under threat by the police. A consideration of the pleadings and the
evidence on record shows that the signature and the execution of the cheque as
such are admitted. The written statement also does not contain the details of
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the alleged threat/duress of the police by which the cheque was forced to be
handed over. Once execution stands admitted, the presumptions available
under Sections 118(a) and 139 of the Negotiable Instruments Act come into
operation. It was therefore incumbent upon the defendants to rebut those
presumptions by leading satisfactory evidence to substantiate the defence
taken. Except for the interested testimony of DW1, no acceptable evidence has
been adduced to probabilise the defence. The trial court was therefore justified
in holding that the statutory presumptions remained unrebutted. Once
execution and delivery are proved, the controversy is not one relating to the
mode of delivery, negotiation, or endorsement contemplated under Sections 46,
47, and 50 of the Negotiable Instruments Act. Those provisions, therefore, have
no application to the facts of the present case and do not advance the case of
the appellants. The pleadings and the oral evidence also specifically identify the
person who issued the respective cheque and the circumstances in which the
settlement was arrived at. The defendants themselves suggested in cross-
examination that the cheque were obtained by the Circle Inspector under
coercion, thereby acknowledging the existence and delivery of the instruments
while disputing only the voluntariness of the transaction.
28. In Dr. Jyothi Prasad Bhat v. K. Sundara Rajan & Ors. [2013
(3) KHC 141], this Court rejected a similar defence where the accused
alleged that the police had forcibly obtained his signature on the
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cheque. The Court held that the plea was only a bald allegation unsupported by
any evidence, noting that the accused had failed to produce any
contemporaneous complaint or other material establishing coercion. It was
therefore held that such an unsubstantiated plea was insufficient to rebut the
statutory presumptions arising in favour of the holder of the cheque. The same
principle applies here, as the accused has failed to produce any reliable
material to establish that the cheque was obtained under threat or coercion.
The defence taken by the defendants is also mutually destructive. At one stage,
their case is that signed cheque was taken away by the police; elsewhere, they
contend that blank cheque was taken under threat. The evidence of DW1
further suggests that the cheque was allegedly taken while she was in hospital,
whereas the appeal proceeds on the footing that the cheque was taken while
defendants 2 and 3 were in judicial custody. These inconsistent versions
seriously impair the credibility of their defence.
29. There is nothing on record to show that any complaint was made
to any authority regarding the police action in forcing the defendants to hand
over the cheque. The mere fact that defendants 2 and 3 were subsequently in
judicial custody does not probabilise the defence, particularly when the
plaintiffs’ case is that the cheque was issued before their arrest. No material has
been produced to establish that the cheque was, in fact, executed during the
period of judicial custody. Such facts were within the exclusive knowledge of
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the defendants, and the burden to establish the same rested entirely upon
them. That burden has not been discharged. The total absence of such evidence
renders the plea wholly improbable.
30. The above discussion relating to the execution of the cheque is
confined to O.S. No.528 of 2009 (R.F.A. No.263 of 2017), where the plaintiff’s
claim is additionally supported by the cheque admittedly signed by the
defendants. These principles relating to statutory presumptions under the
Negotiable Instruments Act do not govern O.S. No.468 of 2009, where no cheque
forms the foundation of the claim. Insofar as O.S. No.468 of 2009 (R.F.A. No.170
of 2017) is concerned, the plaintiff has proved the transaction independently of
any cheque. Ext.A6 establishes that a sum of Rs.2,48,625/- was remitted directly
to the joint account of defendants 2 and 3 pursuant to their directions. This
documentary evidence, read together with the oral testimony of PW1 and the
admitted payment of service charges, clearly establishes that the defendants
received the amounts in connection with the promised overseas employment.
The defendants have neither disputed the receipt of the amount covered by
Ext.A6 nor established that it was refunded. Consequently, the decree in O.S.
No.468 of 2009 rests upon independent documentary evidence and is wholly
unaffected by the absence of a cheque.
31. It is the specific case of the plaintiffs that money was transferred
to GEC on instructions from defendants 1 to 3. There is nothing on record to
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discredit the same. At this juncture, it is pertinent to note that the case of the
plaintiff is that there was no statutory licence for the first defendant at the
relevant time, as the application for a licence was made only on 05.07.2006 and
the same was granted on 02.03.2007. It is clear that the payments made by the
plaintiffs stand independently, as proved by the bank records, passbooks,
corporate receipts, and the oral evidence, and the decree granted does not rest
solely upon the said document.
32. The contention that there was no pleading about the
circumstances under which the settlement was arrived at, or when the cheque
was handed over, also deserves rejection. The pleadings, read as a whole,
disclose that after the failure of the promised overseas employment, the
defendants agreed to refund the amounts received and, in part performance
thereof, made certain cash payments and thereafter issued the respective
cheques towards the balance amounts. These acts surely show the nature of the
settlement which led to the issuance of the cheque in question. The specific
contention of the plaintiff was that there was a promise to return the money if
the job offered was not materialised, and therefore the cheque was given in OS
No. 528/2009. It is also submitted that Ext.A1 showed the defendant as a
managing partner, which shows the existence of a firm.
33. The contention that the plaintiffs failed to prove the transaction
through their own evidence and that the evidence of the power of attorney is
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not admissible also cannot be accepted. In the instant cases, even the case of
the defendants was that they were the authorised agents of GEC and that,
except for the service charges, the amounts were paid directly by the plaintiffs
to GEC. The defendants have also admitted the receipt of the service charges,
and their case is that they had already refunded the same. The evidence on
record further shows that the defendants acknowledged their liability, made
part payments to the plaintiffs, and thereafter issued the disputed cheques
towards the settlement of the balance amounts. Therefore, even assuming that
the oral evidence of any particular plaintiff is kept out of consideration, the
admitted facts, the documentary evidence, and the conduct of the defendants
themselves sufficiently establish the plaintiffs’ entitlement to the reliefs
claimed.
34. As regards the question as to whether the 4th defendant was a
partner, Ext.A1 clearly showed the 2nd defendant as a managing partner, and
the joint account in a bank also showed that it was a firm operating the
account, despite which the partnership deed was not produced by defendants 1
to 3. Under such circumstances, the finding of the trial court that the 4th
defendant is also liable cannot be said to be wrong.
35. The trial court rightly found that GEC was not a necessary party to
the suits, and the agent had not disclosed the name of the principal, and that
the defendants had failed to establish that they were merely agents without
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personal liability. It is found that the defendants have not pleaded that they are
partners or proprietors, and that they registered a fictitious company to recruit
candidates for foreign employment and cheated several job aspirants. The trial
Court also found that the defendants cannot be heard to contend that they
simply introduced job seekers to the plaintiffs. It is not proven that after
receiving the amount from the plaintiffs, the same was sent to the GEC. The
trial court also found that there is no evidence to prove the return of any
amount to the plaintiffs and therefore, the plaintiff is entitled to realise the
money from the defendants with interest. The Trial Court found that the
money was deposited by the plaintiffs as per the instructions of the defendants,
and a cheque was issued in RFA 263/2017 for refund; there is no evidence to
show that it was issued by force or coercion, etc. RFA 263/2017 is a fit case to
draw a presumption under Section 139 of the N.I. Act that the statutory
presumption under the Negotiable Instruments Act had not been rebutted. The
trial court further found that the cheque had been issued towards a legally
enforceable liability. Accordingly, O.S. No.468 of 2009 was decreed directing the
defendants to pay Rs. 2,98,625/- with interest at 6% per annum from the date of
suit till realisation and costs, and O.S. No.528 of 2009 was decreed directing the
defendants to pay Rs. 3,76,800/- with interest at 6% per annum from the date of
suit till realisation and costs. Aggrieved thereby, the defendants have preferred
these appeals.
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36. The absence of a cheque in O.S. No.468 of 2009 (R.F.A. No.170 of
2017) is of no consequence, as the liability of the defendants is independently
established by the oral and documentary evidence, including Ext.A6, which
evidences the remittance made directly to the joint account of defendants 2 and
3. In O.S. No.528 of 2009 (R.F.A. No.263 of 2017), apart from the evidence
relating to the underlying transaction, the cheque issued by the defendants
furnishes an additional basis for fastening liability by reason of the statutory
presumptions under the Negotiable Instruments Act, which the defendants
have failed to rebut.
37. An appreciation of the entire facts and circumstances of the case
clearly shows that the findings recorded by the trial court are based upon a
proper understanding of the pleadings and evidence, both oral and
documentary. No material evidence has been ignored, nor has any inadmissible
material been made the sole basis of the decree. The conclusions reached by the
trial court are perfectly in order, and I find no reason to interfere with the
common judgment and decrees passed by the court below.
Accordingly, the appeals are dismissed.
Sd/-
MOHAMMED NIAS C.P.
JUDGE
okb/
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Judgment reserved 02/7/26
Date of Judgment 20/7/26
Judgment dictated 3/7/26
Draft judgment placed 10/7/26
Final judgment uploaded 20/7/26
