Calcutta High Court
Meera Dhanuka vs Bank Of India & Another on 10 January, 2025
IN THE HIGH COURT AT CALCUTTA
(Ordinary Original Civil Jurisdiction)
COMMERCIAL DIVISION
Present:
The Hon'ble Justice Krishna Rao
GA No. 1 of 2022
In
CS (COM) No. 339 of 2024
(Old No. CS 14 of 2022)
Meera Dhanuka
Versus
Bank of India & Another
Mr. Jishnu Chowdhury, Sr. Adv.
Mr. A. Agarwalla
Mr. Varun Kothari
Mrs. Debjani Mukherji
... For the plaintiff.
Mr. Rudraman Bhattacharya, Sr. Adv.
Mr. Sourojit Dasgupta
Mr. Victor Dutta
... For the defendant no. 1.
2
Hearing Concluded On : 09.12.2024
Judgment on : 10.01.2025
Krishna Rao, J.:
1. The plaintiff has filed the present application being G.A. No.1 of 2022
in C.S. (COM) No. 339 of 2024 (Old No. C.S. 14 of 2022) praying for
mandatory direction upon the defendants to forthwith issue No Dues
Certificate to the plaintiff in respect of the loans provided by the
defendants in favour of the Company, namely, Riga Sugar Company
Ltd. and injunction restraining the defendants from terming the
plaintiff as a defaulter in respect of the loans provided by the
defendants in favour of the Company, i.e. Riga Sugar Company Ltd. in
any manner whatsoever.
2. The plaintiff has filed the suit against the defendants for declaration
that the plaintiff's guarantee given to the defendants in respect of the
loans provided by the defendants in favour of the Company, Riga Sugar
Company Ltd. has stood disclosed, mandatory direction upon the
defendants to forthwith issue No Dues Certificate to the plaintiff in
respect of the loans provided by the defendants in favour of the Riga
Sugar Company Ltd. and perpetual injunction.
3. The plaintiff being the owner of the Flat No. III(A) (Ground Floor), (Front
Portion), Plot No. W-52, Greater Kailash, Part-II, New Delhi - 110048
(hereinafter referred to as "said premises") had agreed to create
equitable mortgage in respect of the said premises in favour of the
defendant nos.1 and 2, for the purpose of securing certain financial
assistance to be further rendered by the defendant no.1 in favour of the
company, namely, Riga Sugar Company Limited belonging to the
husband of the plaintiff.
4. As per suggestion of defendant no.1, GCA Technical Consultants was
appointed to ascertain valuation of the said premises. As per valuation
report dated 14th May, 2015, the value of the said premises was
determined at Rs. 6,97,50,000/-. The plaintiff has agreed to provide a
personal guarantee, as a surety for the said company, however,
restricted to the value of the said premises. The plaintiff made over the
title deeds of the said premises with the intention of creating mortgage.
By a letter dated 1st December, 2015, the defendant no.2
renewed/sanctioned the credit facilities of the said company. On 17th
December, 2015, the plaintiff has executed a Deed of Guarantee by
which the plaintiff restricted her guarantee to the value of the said
premises i.e. Rs. 6,95,00,000/-.
5. In the year 2016, the Company once again negotiated with the
defendants for the same loans and on 12th May, 2016, a Term Loan
Agreement recording the renewal was executed between the said
company and the defendants.
6. Mr. Jishnu Chowdhury, Learned Senior Advocate, representing the
plaintiff submits that the plaintiff's guarantee was extended from time
to time, restricting the guarantee to the value of the said premises or to
the extent of the term loan whichever is lower. The amounts were due
and payable by the said company to the defendants, the defendants
proceeded under the Securitization and Reconstruction of Financial
Assets and Enforcement of Security Interest Act, 2002 and issued
notice under Section 13(2) of the said Act to the plaintiff as well as to
the said company. The plaintiff has submitted her reply to the said
notices and no further steps pursuant to the said notices was taken by
the defendants.
7. Mr. Chowdhury submits that with the consent of the defendants, the
said premises was sold by way of Deed of Conveyance dated 7th July,
2021 for a total consideration of Rs. 4,00,00,000/- and the said sum
has been received by the defendants and upon receipt of the said sum
by the defendants, the plaintiff's guarantee stood discharged. He
submits that on 6th August, 2021, the plaintiff requested the
defendants to record discharge of her liabilities and to issue necessary
documents but the defendants by a letter dated 11th August, 2021
refused to accede to the request made by the plaintiff.
8. Mr. Chowdhury submits that the guarantee of the plaintiff was
restricted to the extent of the term loan or the extent of value of the
said premises, which ever was lower and with the consent of the
defendants, the plaintiff has sold the mortgaged property and the
defendants have appropriated the entire sale consideration, thus the
plaintiff's guarantee in respect of the loans provided by the defendants
in favour of the company has stood discharged.
9. Mr. Chowdhury submits that the defendants are not issuing No Dues
Certificate to the plaintiff and are in the process of treating the plaintiff
as defaulter but the same is impermissible and the plaintiff cannot be
treated as a defaulter.
10. Per contra, Mr. Rudraman Bhattacharya, Learned Senior Advocate,
representing the defendant no. 1, submits that the suit filed by the
plaintiff is not maintainable under law, as this Court is not having
jurisdiction to try and determine the dispute between the parties. He
submits that the plaintiff has attempted to restrain the defendant no.1
from taking steps under the Securitization and Reconstruction of
Financial Assets and Enforcement of Security Interest Act, 2002 or the
Insolvency and Bankruptcy Code, 2016.
11. Mr. Bhattacharya submits that the suit is not maintainable as the
plaintiff has not complied with the provisions of Section 12A of the
Commercial Courts Act, 2015 by instituting of pre-institution mediation
process. He submits that the plaintiff has filed the present application
and the suit by suppressing the material facts.
12. Mr. Bhattacharya submits that at the time of furnishing the guarantee
by the plaintiff, the value of the said premises was Rs. 6.58 Crores
based on the valuation report dated 2nd July, 2018 but at the time of
sale of the said premises, the value of the said property was fixed at Rs.
4.00 Crores. The sale proceeds of the said premises have been adjusted
with the liability of the Riga Sugar Company Limited and the defendant
no.1 has every right to proceed against the plaintiff for balance
outstanding amount.
13. Mr. Bhattacharya submits that by a letter dated 11th June, 2021 and
by an email dated 5th July, 2021, it was again informed to the plaintiff
that the personal guarantee of the plaintiff shall continue even after the
sale of the said premises at Rs. 4.00 Crores and that the liability of the
plaintiff will not cease. He submits that the plaintiff was always aware
that the sale of the said premises would not and can never amount to
release or dischargement of her guaranteed liabilities towards the
defendant no.1. He submits that the account of the principal debtor,
namely, Riga Sugar Company Limited was declared as Non-Performing
Asset on 30th September, 2018 and thereafter, the defendant no.1 had
every right to proceed against the plaintiff for enforcing such guarantee.
14. Mr. Bhattacharya submits that prayer (a) of the present application and
prayer (b) of the suit are similar and identical. He submits that if this
Court allows the prayer (a) of the present application, the same amount
to final decree in the suit which is not permissible under law. Mr.
Bhattacharya in support of his submissions relied upon the judgment
in the case of Samir Narain Bhojwani Vs. Aurora Properties and
Investments and Another reported in (2018) 17 SCC 203.
15. The plaintiff has relied upon Clause - 2 of Deed of Guarantee dated 17th
October, 2015 which reads as follows:
"2. This Guarantee shall be a continuing guarantee
for the purpose of securing the whole of the
monies (actual and contingent) mentioned in
clause 1 hereof (subject to the aggregate
principal amount under the said Credit
facilities not exceeding Rs. 6,94,00,000/-
(Rupees Six Crores Ninety Four Lacs), together
with all interest, thereon, or on such sum as
may be due, at the rate of 4.80% over Base
rate i.e. presently at 14.50% p.a. with monthly
rests or at such other rate of interest as the
Borrower shall be liable to pay from time to
time under the said Credit facilities and, such
penal/additional interests, costs, commissions
and other costs, charges and expenses,
payable by the Borrower under the said Credit
facilities, that have accrued or shall accrue
due to the Bank at any time before or after the
date of demand. The Guarantor/s shall be
liable for interest on all the monies guaranteed
hereunder on daily balance basis or at such
other basis, compounded at monthly rests, till
the date of actual realization of the dues by
the Bank. The Guarantor/s shall be bound by
the rate/s of interest, as may be fixed by the
Bank from time to time, for the said Credit
facilities sanctioned to the Borrower. The
Guarantor/s further agree that Bank shall be
within its absolute right to fix and revise the
rate/s of Interest and the manner of
capitalization of the same, from time to time, in
respect of all or any of the said Credit facilities
granted to the Borrower and in this regard the
Guarantor/s agree that notwithstanding
anything contained in this agreement or in any
other writings the notice board of the Branch
office of the Bank from where the Borrower
has availed the said Credit facilities or
through entry of interest charged in the
statement of Account/Loan Account of the
Borrower. The revised rates of
interest/procedure shall be applicable and
binding on the Guarantor/s from the effective
date stated in the said publication/display."
16. The plaintiff also relied upon the Clause - 11(4)(2) of the Loan
Agreement dated 12th May, 2016 which reads as follows:
"11(4)(2) Personal Guarantee.
In order to secure her obligations and/or liabilities
under the Guarantee, as aforesaid, Meera Dhanuka
should create first mortgage and/or charges over
and in respect of her residential Flat No.3 (Ground
Floor) (front portion) having super built up area
2206.00 square feet on Plot area 990.00 Sq.yards
(828.70 Square Meters) [proposed] comprised in
Plot No.W-52, Greater Kailash, Part - II, New Delhi
and the Guarantee of Meera Dhanuka shall
however be restricted to the value of her above
residential property at New Delhi provided however
the Guarantee of Meera Dhanuka shall be
restricted to the amount of Term Loan or value of
her residential property at New Delhi, whichever is
lower to be mortgaged in favour of the Lenders as
and by way of first pari passu charge in order to
secure her obligations and/or liabilities under the
Guarantee as also to secure the said Term Loans."
17. The specific case of the plaintiff is that the plaintiff has sold the said
premises after approval of the defendants for a total sum of Rs. 4.00
Crores and the total amount has been realized by the defendant bank
and as per the above mentioned clauses, the defendants are required to
discharge the plaintiff as guarantor. The defendants are relying upon
Clauses- 9, 19 and 22 of the Deed of Guarantee dated 3rd November,
2017 which reads as follows:
"9. Notwithstanding the Lead Bank's right
under any security which the Lead Bank may have
obtained or may obtain the Lead Bank shall have
fullest liberty to call upon the Guarantor to pay the
principal sum not exceeding Rs.82.50 Crore
together with interest as well as the costs (as
between Advocate and client) charges and
expenses, and/or other money for the time being
due to the Lead Bank in respect of or under the
above mentioned credit facilities or any of them
without requiring the Lead Bank to realise from the
Borrower the amount due to the Lead Bank in
respect of the abovementioned credit facilities
and/or requiring the Lead Bank to enforce any
remedies or securities available to the Lead Bank.
19. The Guarantee hereby given is
independent and distinct from any security that the
Lead Bank has taken or may take in any manner
whatsoever whether it be by way of hypothecation,
pledge and/or mortgage and/or any other charge
over goods, movables or other assets and/or any
other properties, movable or immovable and that
the Guarantor has not given this guarantee upon
any understanding, faith or belief that the Lead
Bank has taken and/or may hereafter take any or
other such security and that notwithstanding the
provisions of Section 140 and 141 of the Indian
Contract Act, 1872 or other section of that Act or
any other law the Guarantor will not claim to be
discharged to any extent because of the Lead
Bank's failure to take any or other such security or
in requiring or obtaining any or other such security
or losing for any reason whatsoever including
reasons attributable to its default and negligence
benefit of any of other such security or any of rights
to any or other such security that have been or
could have been taken.
22. In terms of sanction the Guarantor hereby
agrees and undertakes to create mortgage over and
in respect of her residential Flat being Flat No.3
(Ground Floor) (front portion) having super built-up
area of 2206.00 Square feet on Plot area 990.00
Sq. yards (828.07 square meters) [proposed]
comprised in Plot No. W-52, Greater Kailash, Part -
II, New Delhi, in order to secure her obligations
and/or liabilities under this guarantee and
notwithstanding anything to the contrary herein
contained, the liability of the Guarantor under this
Guarantee shall be restricted to the value of her
residential property as aforesaid i.e.
Rs.__________/- mortgaged and/or agreed to be
mortgaged in favour of the Lead Bank."
Relying upon the said Clauses, the defendants says that the latest
sanction being M. Com dated 20th February, 2021 even after sale of the
residential flat at the rate of Rs. 4.00 Crores, the personal guarantee in
the account of M/s Riga Sugar Company Limited will continue.
18. By a letter dated 7th January, 2020, the defendant bank informed the
Kataria Constructions Pvt. Ltd. about the terms and conditions of the
sale and purchase of the property of the plaintiff. Subsequently, on 7th
July, 2021, a Sale Deed was executed between the plaintiff and one
Mrs. Bhavna Kataria with respect to the mortgaged flat of the plaintiff
for a total sum of Rs. 4.00 Crores. Before execution of the Sale Deed
dated 7th July, 2021, the defendant bank by a communication dated
19th March, 2021 informed Riga Sugar Co. Ltd. that "Release of
personal guarantee of the plaintiff upon sale of the Delhi flat is declined
by competent authority". Subsequently, by a communication dated 11th
June, 2021, the defendant bank informed the plaintiff that as per
sanction by the competent authority, the personal guarantee in the
account of M/s Riga Sugar Co. Ltd. shall be continued even after the
sale of the flat at the rate of Rs. 4.00 Crores and liability as a personal
guarantor will not cease. In the said communication, it was further
clarified that on receipt of Rs. 4.00 Crores in the account of M/s Riga
Sugar Co. Ltd., the liability may be reduced by Rs. 4.00 Crores.
19. The plaintiff had the knowledge before execution of sale deed with
respect to her flat for a total sum of Rs. 4.00 Crores, the defendant
bank will not release her personal guarantee, but the plaintiff has
executed sale deed and now claiming for her release as guarantor of
M/s Riga Sugar Co. Ltd., thus this Court finds that the plaintiff has not
made out any prima facie case or balance of convenience in her favour.
20. As regard to the maintainability of the suit, the same is to be decided at
an appropriate stage, the same cannot be decided at the time of hearing
of injunction application. As regard to the noncompliance of the
provision of Section 12A of the Commercial Courts Act, 2015, this
Court finds that at the time of admission of plaint, leave under Section
12A of the Commercial Courts Act, 2015 was dispensed with.
21. In view of the above, G.A. No. 1 of 2022 in C.S. (COM) No. 339 of
2024 (Old No. C.S. 14 of 2022) is dismissed.
(Krishna Rao, J.)
