Hindustan Copper Ltd vs Vijaya Bank And 2 Others
2021 Latest Caselaw 9111 Bom

                                     1/4            13.07.2021 2SJ 69.17.docx


         IN THE HIGH COURT OF JUDICATURE AT BOMBAY
            ORDINARY ORIGINAL CIVIL JURISDICTION

               SUMMONS FOR JUDGMENT NO. 69 OF 2017
                                IN
             COMMERCIAL SUMMARY SUIT NO.252 OF 2017
                              WITH
              INTERIM APPLICATION (L) NO.14637 OF 2021
                                IN
               SUMMONS FOR JUDGMENT NO. 69 OF 2017


 Hindustan Copper Ltd.                                   ...     Petitioners
       v/s.
 Vijaya Bank & 2 ors.                                    ...       Respondents


 Mr. S.S.Kulkarni, along with Sachin Chavan for petitioners.

 Mr. Madhur Rai i/b. PRS Legal for defendant no.1.
 Mr. Akash Memon for defendant no.3.

                           CORAM: DAMA SESHADRI NAIDU, J.

13th July 2021

P.C.

The 3rd defendant-a private limited company-contracted with the plaintiff--a Government of India undertaking--for the supply of copper. The first defendant is the 3rd defendant's banker, and the 2nd defendant is the plaintiff's banker. In this commercial summary suit, initially, on 16th April 2019, the plaintiff and the 3 rd defendant filed

2/4 13.07.2021 2SJ 69.17.docx

Consent Terms.

2. As per those Terms of Consent, the 3rd defendant undertook to repay the suit debt in instalments. One of the conditions is that if the 3rd defendant defaults on paying any single instalment, the plaintiff may have the suit restored against the 1st and the 2nd defendants.

3. Indeed, the 3rd defendant defaulted on his commitment. Thus, Suit has been restored against the 1st and the 2nd defendants.

4. On the last couple of occasions, the 3 rd defendant assured the Court that it would file an affidavit detailing its difficulties in meeting the terms of consent and its right to get back its title deeds from the 1 st defendant bank. In other words, the 3 rd defendant has represented to the Court that it cleared all the dues it had once owed to the 1 st defendant bank, but the bank did not return those documents. After taking a couple of adjournments, the 3rd defendant came up with this interim application, instead of an affidavit as undertaken earlier, seeking these reliefs:

"a) Direct defendant no.1 to release and hand over to the applicant the original title documents pertaining to the subject property, as are in its possession.

b) Extend the timeline of payment stipulated in the Consent Terms, and allow the Applicant/Defendant No.3 to pay the balance Settlement Amount, being an amount of Rs.67,28,186/- within a period of 90 (ninety) days from receipt of the Original Title Documents."

5. Today, in response to the 3rd defendant's insistence for the

3/4 13.07.2021 2SJ 69.17.docx

release of its title deeds, the learned counsel for the defendant bank informs the Court that the plaintiff has sought relief of recovery against the defendant bank, too. Put plainly, in this suit the liability of all the defendants is joint and several. Though the 3rd defendant has already cleared the dues, it cannot part with the documents because of the plaintiff's present claim against the first defendant. That is the last security the bank holds to indemnify itself.

6. Of course, the bank's counsel has also argued on the issue whether the 1st defendant stands discharged from its liability because the plaintiff deviated from the contractual stipulations and, as the learned counsel puts it, dealt directly with the 3rd defendant without the bank's consent. That argument impinges on the merits of the matter, however. In the end, the learned counsel for the first defendant bank has informed the Court about the bank's willingness to deposit those title deeds with the Court--without prejudice to the bank's claims and contentions in this suit. The Court, indeed, appreciates the bank's candidness.

7. On the other hand, the learned counsel for the plaintiff explains that the plaintiff has two options simultaneously. To elaborate, he has submitted that the plaintiff may execute the consent decree already secured against the 3rd defendant. At the same time, it may also proceed against the 1st and 2nd defendants in the restored suit. In this context, the learned counsel urges the Court that the first defendant should not

4/4 13.07.2021 2SJ 69.17.docx

part with the documents; especially, it should not return those documents to the 3rd defendant for, at least, the next three weeks. It is because the plaintiff wants to lay an execution against the 3 rd defendant and intends to seek an attachment of the property covered by those title deeds.

8. Once the 1st defendant bank is willing to deposit the documents with the Court, the contingency of its parting with those documents in the 3rd defendant's favour does not arise.

9. Under these circumstances, I direct the 1 st defendant, as it has agreed, to deposit the 3rd defendant's title deeds with the Court in two weeks. And that depositing is without prejudice to the first defendant bank's rights and contentions in the Suit.

10. In the meanwhile, the 3rd defendant may explore all avenues to honour the consent terms; and the plaintiff, all remedial steps to enforce the decree against the 3rd defendant.

Post the matter on 27th July 2021.

(DAMA SESHADRI NAIDU, J)

Lata Panjwani, P.S.