State Bank Of India vs M/S Rajdhani Steels And Others
1998 Latest Caselaw 124 Del

JUDGMENT

C.M. Nayar, J.

1. The plaintiff has filed the present suit for recovery of Rs.1,06,953.44 with costs and interest pendente lite and future at the rate of 17 1/2% per cent per annum against the respondents.

2. Plaintiff Bank is a body corporate constituted by the State Bank of India Act, 1955 having its Central Office at Madam Cama Road, Nariman Point, Bombay, and one of its Local Head Office at 11, Parliament Street, New Delhi. It has its branches throughout India and one such branch is situated at Naraina which is under administrative control of Local Head Office at New Delhi.

3. Shri D.C. Goyal is the Branch Manager and Principal Officer of the State Bank of India and has been Office to file and institute the suit and is conversant with the facts of this case. He is competent to sign and verify all types of pleadings, vakalatnamas, affidavits, execution and various other applications and to do all acts necessary for proper conduct of legal proceedings filed on behalf of the plaintiff-Bank in terms of General Regulations, 1955 made by the Reserve Bank of India in exercising of the powers conferred by subsection (3) of Section 50 of the State Bank of India Act, ,1955 with the previous section of the Central Government read with the notification published in the Gazette of India dated September 26, 1972.

4. It is alleged that defendants 2 and 3 while working in the name and style of defendant No.1 as its partners opened a Current Account No.2060 with the plaintiffbank on 7th February, 1983 in the name of the defendant No.1 i.e. M/s. RAJDHANI STEELS. Defendants had been requesting the plaintiffBank several times either to purchase their cheques or to allow them temporary overdraft facility in their aforesaid current account. On 27th December, 1983, the defendants came to the plaintiff Bank alongwith a cheque for a sum of Rs.30,000/- bearing No.CE-043873, drawn on State Bank of India, Industrial Estate, Gobindpura, Bhopal, MP, by M/s. Malik Electromechanical Industries, favouring defendant No.1 and they requested the plaintiff-Bank to purchase the said cheque. Since it was a outstation cheque and the proceeds of the same would have taken some time to come to the credit in the account of defendant No.1 they requested for purchasing the cheque by the plaintiff-Bank.

5. It is further alleged that the plaintiff-Bank considered the request of the defendants and purchased the cheque on 27th December, 1983 and after charging its discount, the plaintiff-Bank credited the amount of the cheque in the aforesaid current account of defendant No.1, which the defendants withdrew lateron. Again on 30th December,1983, the defendants approached the plaintiff-Bank with a cheque of Rs.50,000/- to purchase the same. The cheque bearing No.BDA-091250, dated 29th December, 1983 was drawn on Bank of Maharashtra, Karnal Haryana, drawn by M/s. B.K. Agro Enterprises favouring defendant No.1. Plaintiff considered the request of the defendants and purchased the aforesaid cheque on 30th December, 1983 and after charging its discounting commission the cheque amount was credited to the current account of defendant No.1 bearing No.CA-2060. The said amount was subsequently withdrawn by the defendants. Further facts are stated in paragraphs 9 to 14 which read as under.

"9. That the aforesaid two cheques so purchased by the plaintiff bank were sent in clearing for collection. The cheque for Rs.30,000/- was returned as dishonoured and accordingly the aforesaid current account No.CA 2060 of the defendant No.1 was debited with amount of Rs.3,0460.26 paise which includes the cheque amount and the interest accrued thereon till 23rd January, 1984.

10. That likewise the cheque for Rs.50,000/- drawn on Bank of Maharashtra was also returned as dishonoured with the remarks,'Refer to Drawer'. Accordingly a sum of Rs.50,657.53 was debited to the current account of the defendant No.1.

The said sum of Rs.50,657.53 paise, also includes the interest from the date of purchase till 23.1.1984 besides the amounts of cheque.

11. That the defendants were duly informed about debiting their account with the aforesaid amounts vide plaintiff's letter dated 27th January, 1984.

12. That after getting the information of dishonouring of the cheques, the defendants were under liability/obligation to make payment of the amount by which their account No.CA-2060 was debited. The defendants have failed to repay the amount even despite various requests and demands made by the plaintiff-bank, including the demand notice dated 23rd May, 1985, sent through Shri Om Parkash Sharma, Advocate, for the plaintiff-bank.

13. That the amount so availed by the defendants is a clean advance and as such they are liable to pay the interest to the plaintiff-bank at the rate as is applicable to any clean advance as per Reserve Bank of India directions. The defendants are liable to pay the interest at the rate of 17.1/2% per annum with quarterly rests to be calculated on daily balance basis.

14. The defendants acknowledged the debts by way of signing the balance confirmation letter dated 27th March, 1986 and also promised to pay the outstanding amount by way of writing a letter dated 27th March, 1986 to the plaintiff-bank, thus the suit of the plaintiff-bank is well within limitation.

6. A sum of Rs.1,06,953.44 which includes the interest upto 23rd March, 1987 is due and outstanding against the defendants, which the defendants are liable to pay jointly and severally to the plaintiff-Bank and has failed to pay despite various requests and demands made by the plaintiff- bank, both orally as well as in writing. The cause of action for filing the suit firstly arose on December 27, 1983 when the cheque for a sum of Rs.30,000/- was purchased by the plaintiff and further it arose on December 30, 1983 when the second cheque for Rs.50,000/- was purchased by the plaintiff at the request of defendants. It also arose on 23rd January, 1984, 27th January, 1984 and 23rd May, 1985. It finally arose on 27th March, 1986 when the debt was acknowledged by way of signing the balance confirmation letter and also when the promise was made to pay the outstanding amount.

7. Summons in the suit were issued to the defendants and they were duly served. Vide order dated November 15,1990 they were proceeded against ex parte. Evidence by way of affidavits has been filed.

8. Exhibit Pw1/1 is the Account Opening Form dated February 7, 1982 signed by defendants 2 and 3. Defendants 2 and 3 deposited a cheque dated December 27, 1983 for Rs.30,000/- vide payinslip Exhibit PW1/2. drawn by M/s Malik Electro Mechanical Engineers in favour of defendant No.1 and drawn on their Bankers, State Bank of India, Industrial Estate, Govindpura Branch, Bhopal (M.P.). Vide payinslip Exhibit Pw1/4 dated 30th December, 1983 the defendants again deposited another cheque dated 29th December, 1983, drawn by M/s B.K.Agro Enterprises on their bankers, Bank of Maharashtra, Karnal Branch for Rs.50,000/-. Plaintiff Bank received the return memo from Bank of Maharashtra, Karnal Branch vide letter dated January 27, 1983. Exhibits PW1/8 and PW1/9 are the debit vouchers. Exhibit PW2/1 is the balance confirmation letter dated 27th March, 1986 signed by the defendants. Exhibit PW2/2 is the letter dated 27th March, 1986 thereby promising to clear the amounts outstanding in the Current Account. Exhibit PW2/3 is the statement of account. A demand notice was sent to the defendants dated 23rd May,1985 which is Exhibit PW2/4. The defendants failed to pay the amount outstanding despite the said notice.

9. I have heard learned counsel for the plaintiff and also perused the documents on record. The defendants have neither appeared in Court nor put forward their defense to controvert the claim of the plaintiff. The perusal of the documents as well as evidence placed on record by the plaintiff leave no manner of doubt that the loan facilities were enjoyed by the defendants and, as such, the plaintiff has proved the claim and the defendants are liable to pay the amount as claimed in the suit.

10. Accordingly, I pass a decree in the sum of Rs.1,06,953.44 in favour of the plaintiff and against the defendants with costs. The plaintiff shall also be entitled to pendente lite and future interest at the rate of 12 per cent per annum from the date of institution of the suit till realisation.