United Bank of India vs Tarachand Mohanlal and Others

N.S. Singh, J.—The judgment dated 19.8.91 and connected decree dated 21.1.92 passed by the learned Additional District Judge, Dhubri in Title Suit (M) No. 4 of 1988 dismissing the suit of the Appellant Plaintiff is the subject matter under challenge in this appeal.

The Appellant as a Plaintiff instituted a suit against the present Respondents and one Yatayat P. Limited Proprietor, New India Transport Co., 18 Tarachand Dutta Street in the town of Calcutta initially before the trial Court concerned for a Money decree of Rs. 3,50,428.80 Paise and recovery thereof with interest @ 11% per annum with monthly rests till the date of decree and 6% per annum on the decreetal amount till date of realization by contending inter alia, that on the apphcation of Defendant Nos. 1, 2, 3 and 4, Defendant Nos. 2 to 4 being the partners of Defendant No. 1 as well as on the request of Defendant Nov 5, the Plaintiff/Appellant bank sanctioned an accommodation by way of Cash Credit by pledge of jute bales. Mustard seeds and against documentary Bills to the tune of Rs. 1,00,000/- initially in favour of the Defendant Nos. 1 to 4 and subsequently raised to the limit of Rs . 2 lakhs and to Rs. 3 lakhs on 24.5.65 and 1.6.68 respectively, for which the Defendants executed pronote, letter of continuity, letter of hen, letter of hypothecation, agreement to pledge goods, Hypothecation of Debts and movable assets, letter of garantee (executed by Defendant No. 5), pledge of Jute in godown and pledge of Ware House Receipt of Rs . 1 lakh; pledge of Dhania Rs. 25,000/-; pledge of Central Ware Housing Receipt covering all agricultural commodities excepting vegetable Oil and mustard oil upto Rs. 2 lakhs; documentary bills covering Jute, Mustard Seeds, Til Seeds, Matikalai, oil cake and Dhania for Rs. 3 lakhs and other additional securities like equitable mortgage of the properties of the said partners in the town of Dhubri as in Schedule-B to the plaint and personal guarantee of the said partners and one Surajmal Sovasaria. Apart from it, the following documents were executed by the Defendants 1 to 5 on 28.10.69:

(a) One pronote for Rs. 3,00;000/- dated 28.10.69

(b) One letter of hypothecation (Bills purchased) dated 28.10.69.

(c) One letter of continuity dated 28.10.69

(d) One letter of lien dated 28.10.69

(e) One letter of guarantee dated 28.10.69 for Rs. 3,00,000/- executed by Mohanlal Bihani, Soharilal Bihani, Dulichand Bihani, the Defendants 2 to 4 for Rs. 3,00,000/-.

(f) One letter of guarantee by the Defendant No. 5, Surajmal Sovasaria.

The said Defendants also deposited related title deeds in respect of the said transactions at Calcutta Branch of the Plaintiff at 4, Narendra Chandra Datta Sarani, Calcutta prior to the execution of the above mentioned docimients and that the Defendants/Respondents Nos. 1 to 4 confirmed their balance of Rs. 2,99,000/- as on 27.10.69. Pursuant to the aforesaid agreement and in terms thereof the Plaintiff Bank duly lent and advanced of the aforesaid money and the Plaintiff duly maintained a mutual open current and continuous account according to English Calendar year of all dealings and transactions in the said account at Dhubri, Assam duly crediting the Defendant No. 1 with all sums paid by the Defendant No. 1 and or reahsed as its behalf of and duly debiting the Defendant No. 1 or on its account for all sums paid by the Plaintiff to the Defendant No. 1 or on its account. In usual course of business the Defendant No. 1, represented by its partners, Defendant Nos. 2 to 4 requested the Plaintiff Bank, Dhubri Branch to advance them against hypothecation of the Bills drawn on M/s. Nava Bharat Corporation of 161 Mahatma Gandhi Road in the town of Calcutta accompanied by Transport Receipt covering consignment of the Jute Bales and the Plaintiff Bank made advances against the bills drawn on Nava Bharat Corporation accompanied with Bills and Transport Receipts. According to the Plaintiff, M/s. Everest Roadways, the Defendant No. 8 delivered all the Jute bales covered by their Transport Receipts to the consignor against indemnity without Plaintiffs knowledge and without production of the transport receipts which has been in the possession of the Plaintiff Bank as the same were endorsed in favour of tiie Bank for valuable consideration received by the consignee Tarachand Mohanlal as the Plaintiff was not a ware of the ultimate destination of the Jute bales taken by the Defendants 6, 7 and 8, but in view of the terms and conditions of consignment note as the plaintiflF Bank accepted the Lorry Receipts, the Defendants 6, 7 and 8 are bound to deliver the goods carried by them to the plaintifiF and none else. As they have not delivered the goods to the Plaintiff, the said Defendants 6, 7 and 8 are liable to the Plaintiff Bank for its dues. It is also the case of tfee Plaintiff that the Defendant Nos. 1 to 4 acknowledged in writing the debit balance of Rs. 2,96,000/- as on 12.11.71 in the said account. Despite the repeated demands made by the Plaintiff Bank for repayment of the said dues in the said account through a demand letter on 11.11.71 to the Defendants as also to the guarantors, they failed to pay the entire dues or any portion thereof Hence the suit for money decree of Rs,3,50,482.80 paise against the said Defendants. Diuing the pendency of the said suit, the name of the Defendant No. 6 was struck off on the prayer of the Plaintiff Bank vide order dated 13.4.91 and as such the claim of the Plaintiff Bank as against the Defendant No. 6 was dropped.

The suit was initially contested by the Defendant Nos. 5, 6 and 7 by filing their respective written statements. But the suit was proceeded ex-parte initially against the Defendants 1, 2, 3 and 4 as they failed to appear and contest the suit despite proper service of summons/notices and subsequently the suit was also proceeded ex-parte against other Defendants as they failed to appear during the proceedings of the case. In the written statement the Defendant No. 5, the guarantor contended that he has been unnecessarily impleaded in the suit and does not admit all the contentions made in paragraphs 1, 2, 3 and 4 of the plaint. According to the Defendant No. 5 the loss and/or damage which the Plaintiff bank alleged to have been suffered was primarily for their feult and negligence of the Bank and that from the fects disclosed in paragraph 7 of the plaint and by the admission of the Plaintiff Bank, the Defendant Nos. 6, 7 and 8 are liable to the Plaintiff for its dues and the balance confirmation letter receipts as described in paragraph 11 of the plaint were obtained illegally and could not saddle any responsibility upon him and the suit is also bad for want of notice u/s 10 of the Carrier''s Act. On the other hand the Defendant Nos. 6 and 7 in their respective written statements contended that inspite of proper notice, neither the Plaintiff nor the Defendant No. 1 took delivery of the said goods and they did not pay the charges of freight, demurrage and other charges as claimed by them and as such, the said Defendants sold the said goods in the aforesaid circimistances and they were lawfully entitled to sell the same in terms of the related contract of carriers. According to them, the Defendant No. 1 was named as consignor and consignee in all the said 6 cases and the name of M/s. Nava Bharat Corporation of Calcutta and/or of the Plaintiff did not appear there. It is also the case of the said Defendant that the Plaintiff was not entitled to get delivery of the said goods and the said Defendants were not bound to deliver the said goods to the Plaintiff Bank under any circumstances unless the entire charges of the said Defendants were cleared first. It was also urged by the said Defendant that trial Court has no jurisdiction to try the suit and the Plaintiff is not entitled to get declaration of charge and/or a preliminary decree for mortgage and charge and/or a final decree for mortgage or charge in respect of the goods covered by the related consignment notices.

On the basis of the pleadings of the parties concerned, the learned trial Court framed as many as 17 issues and other 3 additional issues for just determination of real points in controversy between the parties. Those issues are quoted below:

1) Is there any cause of action for the suit?

2) Whether this Court has jurisdiction to try this suit?

3) Is the suit barred by limitation?

4) Is the suit barred by estoppel, waiver and acquiescence?

5) is the suit bad for nonjoinder of parties?

6) Is the suit bad for misjoinder of cause of action?

7) Is the suit had for want of notice u/s 10 Carriers Act?

8) Whether Plaintiff Bank on the prayer of Defendant Nos. 1, 2, 3, 4, 5 agreed to accommodate by way of pledge of jute bales upto a drawing limit of Rs. 1,00,000/- which was subsequently to Rs. 3,00000/-?

9) Whether Defendant Nos. 1, 2, 3, 4 and 5 executed various documents in favour of the Plaintiff Bank?

10) Whether Defendants created equitable mortgage in favour of the Plaintiff Bank?

11) Whether Defendant No. 8 delivered the jute bales sent through them to the consignor without production of the Transport receipts and without Plaintiff Bank''s knowledge?

12) Whether Defendant Nos. 7 and 6 failed to deliver the jute bales to the Plaintiff Bank ?

13) Whether Defendant Nos. 6, 7 and 8 are liable for non-delivery of the jute bales to the Plaintiff Bank?

14) Whether Defendants Nos. 1 to 4 acknowledged their debts in writing?

15) Whether Defendants Nos. 1 to 5 are hable for the advance made by the Bank?

16) Whether Plaintiff Bank is entitled to a decree for Rs. 2,96,000/-?

17) To what relief if any is the Plaintiff entitled ?

ADDITIONAL ISSUES:

1) Whether each of the different consignments to the different Carrier Defendants formed distinct and different contracts between different persons on different dates and as such the instant suit is not maintainable for such mis-joinder of causes of action and parties?

2) Whether, assignments and hypothecations, if made in respect of the consignments, should have been separately made and if not so made, whether the suit should fail?

3) Whether, the Plaintiff deliberately avoided taking delivery and avoided the payment of rightful charges to the Carriers?

The Plaintiff Bank produced as many as 27 documents and those documents were exhibited as Exhibits 1 to Exhibits 27. The Plaintiff Bank also adduced evidence by producing its witness, namely Sri Subrata Kumar Kanango, the Branch Manager, UBI, Dhubri who was examined as P.W. No. 1. Upon hearing the Plaintiff Bank the learned trial Court dismissed the suit of the Plaintiff Bank under the impugned judgment and decree. Being aggrieved by the impugned judgment and decree passed by the learned trial Court, the Plaintiff Bank filed this Appeal.

Mrs. K. Yadav, learned coimsel appearing for the Appellant''Plaintiff Bank at the very out set submitted that the impugned judgment and decree are not tenable in the eye of law inasmuch as the learned trial Court did not state its decision on each issue as required under Order 20 Rule 5 of the Code of Civil Procedure, According to Ms. Yadav, the learned trial Court lost the sight of this important provisions of law and rather misappropriated the evidence on record while passing the impugned judgment and decree. It is also submitted by the learned Counsel that there are sufficient evidence on record both oral and documentary evidence for proving the case of the Plaintiff Bank and for a money decree as claimed by the Plaintiff in the suit. It is also urged by the leamed counsel that the leamed trial Court had utterly failed to appreciate the documentary evidence like the Demand Promissory Note (Exb-1), Letter of Personal Guarantee of Defendant Nos. 2, 3 and 4 (Exb-5), letter of guarantee made by Defendant No. 5 (Exb-6) and the related balance confirmation letter of the Defendants as in Exhibits 7 to 11, title deeds, and also Memorandum of Equitable Mortgage as in Exb- 25 while passing the impugned judgment and decree. According to Ms. Yadav the learned Addl. District Judge on erroneous interpretation of the pleadings and evidence on record came to a wrong findings that Plaintiffs suit was for realisation of Cash Credit Amount advanced to Defendant No. 1 against the consignment notes. But in fact the Plaintiffs suit was not based on consignment note but on the original contract of loan which was granted on the Defendant No. 1 creating mortgage of the suit property. This important aspect of the matter was not considered by the learned trial Court while passing the impugned judgment and decree Ms. Yadav contended. It was also argued by the learned Counsel that the Plaintiffs suit is a mortgage suit with a prayer for declaration of charge and for preliminary and final decree and for recovery of Rs. 3,50,428.80 paise and also for final mortgage and charge, decree for sale of mortgaged properties in case the Defendants failed to make payment of it. But the learned trial Court had lost the sight of this existing facts and circumstances of the case while rendering the impugned judgment and decree. Urging all these points as raised, the learned Counsel argued that the imputed judgment and decree deserve to be set aside and the suit of the Plaintiff Bank be decreed with costs. None appears for the Defendants-Respondents despite proper service/notices upon them.

Now this Court is to examine as to whetherthe learned trial Court had acted illegally or with material irregularity while passing the impugned judgment and decree or whether the learned trid Court had appreciated the evidence on record in accordance with law or not.

On bare perusal of the impugned judgment and decree, it has been reveled that the trial Court has failed to give its decision on each issue and rather the learned trial Judge not to speak of giving its decision on each issue has failed even to mention or reflect the issues so far framed during the proceeding. Therefore, in our considered view the learned trial Court lost the sight of the provisions of law laid down under Order 20 Rule 5 CPC while passing the impugned judgment and decree and on this count alone, the impugned judgment and decree are not tenable in the eye of law. For better appreciation in this matter, we may refer to Order 20 Rule 5 CPC which provides that in suits in which issues have been framed, the Court shall state its finding or decision, with the reasons therefor, upon each separate issue, unless the finding upon anyone or more of the issue is sufficient for the decision of the suit. Further this Court is to examine as to whether there are sufficient evidence or material on record for granting relief sought for by the plaintiflF Bank in its plaint. From the available materials on record, it is also established that the Defendant Nos. 1 to 4 confirmed their balance as Rs. 2,99,000/- as on 27.10.1969 and rather, Defendants Nos. 1 to 4 confirmed and accepted their statements of account as reflected in Schedule-E to the plaint. Exhibits 7 to 11 are balance confirmation letters. The plaintiflF filed the suit on 26.3.1972 i.e. within the period of 3 years from the date of confirmation of the Defendants'' balance as stated above, as on 27.10.1969. Therefore, in our considered view the suit was filed within time.

So far issue Nos. 1 to 7 are concerned we are of the view that the suit of the Plaintiff Bank is not barred by estoppel, waiver and acquiescence and it is not bad for non-joinder of parties or misjoinder of parties nor bad for want of notice u/s 10 of the Carriers Act. R.W. No. 1 stated that Exhibit 27 is the statements of accounts of the Defendant No. 1. This statement is not rebutted by any of the Defendants by adducing evidence both oral or documentary evidence. From the evidence of P.W. No. 1, it is seen that the Defendant Nos. 1 to 4 applied for Cash Credit Loan and the Bank sanctioned Rs. 1 lakh initially and subsequently Rs. 2 lakhs in the year 1965 and thereafter Rs. 3 lakhs in the year 1968 for which the Defendant Nos. 1, 2, 3, 4 and 5 executed various documents in favour of the Plaintiff Bank. Those documents are produced by the Plaintiff during the proceedings of the suit and those were duly exhibited and proved. Exhibit-1 is the Demand Promissory Note, Exhibits 2, 3, 4, 5 and 6 are bill purchase agreement, continuity letter, letter oflien, letter of personnel guarantee and letter of guarantor, the Defendant No. 5. As discussed above, Exhibit-7 and 11 are balance confirmation letters. Exhibits 12 to 16 are the consignment notes of Everest Roadways, Defendant No. 8. Exhibits 17 to 22 are the consignment notes of AIR Transport Corporation (Defendant No. 7), Exhibits 23 and 24 are related khatians. Exhibit 25 is the memorandum of equitable mortgage and Exihibit 26 is the power of Attorney and Exhibit 27 series are the statements of account of Defendant No. 1. In view of the above position, Plaintiff Bank has proved its case that on the request of Defendant Nos. 1 to 5, the Plaintiff Bank agreed to accommodate and sanction Cash Credit Loan as mentioned above and for which the Defendants concerned executed various documents and created equitable mortgage of the suit land described in Schedule B to the plaint in favour of the Plaintiff Bank and as such the issue Nos. 8, 9, 10, 14 and 15 may comfortably be decided in favour of the Plaintiff Bank. So far issue Nos. 11, 12 and 13 are concerned, the name of the Defendant No. 6 had been struck off from the case on the prayer of the plaiatiff Bank as mentioned above. P.W. No. 1 who is the Branch Manager of UBI, Dhubri stated that the Defendants were to pay the money to Nava Bharat Corporation and to take bank the receipts. But the goods were sent through Defendant Nos. 6, 7 and 8 at Calcutta and the Defendant Nos. 6, 7 and 8 delivered the goods to the Defendants without taking the original receipts and without the knowledge of the Plaintiff and on repeated demands the Defendant Nos. 6, 7 and 8 did not return the goods either to the Plaintiff or M/s. Nava Bharat Corporation and that the Defendant Nos. 1 to 4 did not repay the loan on repeated demands. This feet is not controverted and accordingly, it remains valid. In view of the above position, we are of the view that the Defendant Nos. 7 and 8 are liable to deliver the said jute bales to the Plaintiff Bank and rather they failed to deliver the same to the Plaintiff Bank. The burden of proof of 3 additional issues rests upon the Defendants. But the Defendants did not come forward and did not contest the suit except filing of Written Statement by the Defendants Nos. 5, 6 and 7. In view of the above position, the three additional issues may be decided as against the Defendants.

It is also note-worthy to highlight here that the learned trial Court has completely lost the sight of the provisions of law laid down u/s 4 of the Bankers'' Books evidoice Act, 1891 while passing the impugned judgment and decree. For better appreciation in this regard, we quote Section 4 of the Act as hereunder:

Subject to the provisions of this Act, a certified copy of any entry in a banker''s book shall, in all legal proceedings, be received as prima facie evidence of the existence of such entry, and shall be admitted as evidence of the matters, transactions, and accounts therein recorded in every case where, and to the same extent as, the original entry itself is now by law admissible, but not further or otherwise.

The documents marked Exhibits 1 to Exhibits 22 are all original documents. Exhibits 23 and 24 are the certified copies of khatians. Exhibit 25 is the memorandum of Equitable Mortgage and Exhibit 27 series is the certified copies of statements of accounts of the Defendant No. 1 maintained by Plaintiff Bank. It is well settled that copies of entries in the bankers books are admissible in all legal proceedings for or against any one and the Court cannot reject copies as not tnie without directing the Bank to prduce the original books. Certified copy of the statement of accounts bearing the certificate of ihs General Manager of the Bank that entries were true copies of the entries in one of the ordinary bodes of the Bank and were made in the usual and ordinary course of business and that such books were still in the custody of the Bank becomes evidence u/s 4 of the Act. Statement or account duly certified under the Act is prima facie evidence of the amount due. In the instant case also the statements of account were duly certified by the competent authority of the Bank as seen in the documents marked as exhibit 27 series and as such, it is a prima facie evidence of the amount due with the Defendant Nos. 1, 2, 3 and 4. On perusal of its oral and documentary evidence on record we are of the firm view diat the Plaintiff has established and proved its case and accordingly Plaintiff Bank is entitled for the reliefs claimed in the plaint.

For the reasons and discussions made above, the impugned judgment and decree are set aside and as such the suit is decreed with costs. In the resiilt, the Defendants except the Defendant No. 6 are jointly and severally liable for repayment of Rs. 3,50,428.80 paise with cost and interest @ 11% per annum with monthly rests till the date of decree and 6% per annum on the decreetal amount till the date of realisation and the said Defendants shall pay the said decreetal money to the Plaintiff Bank within a period of one moptii from today, and in defaiih of it the Plaintiff Bank is at liberty to realise the decreets money/amount by way of attachment of the suit property as in Scheme B to the plaint and putting the same by public auction and, in case the proceeds of the sale is foimd to be insufiicient to satisfy the amount due to the Plaintiff Bank, the Plaintiff Bank is at liberty to file an application before the trial/competent Court for recovery of balance due, if any, as required under Order 34 Rule 6 Code of Civil Procedure.

The appeal is allowed accordingly.