Delhi High Court
Electronic Media Corporation vs Bank Of India And Ors. on 5 August, 2002
Author: K Gupta
Bench: K Gupta
JUDGMENT
K.S. Gupta, J.
1. M/s. Electronic Media Corporation, plaintiff filed suit for recovery of Rs. 15,14,122/- arraying Bank of India as defendant No. 1, Canara Bank as defendant No. 2 and M/s. Durga Trading Co., and its three partners as defendants 3 to 6 on 6th/15th November 1997. In the suit the defendant No. 1 has filed I.A. 7187/99 under Section 10 read with Section 151 CPC for staying the suit on the ground of pendency of O.A. No. 874/95 filed by it before the Debt Recovery Tribunal. I.A. No. 6600/99 under Section 10 read with Section 151 CPC has been filed by defendant No. 2 claiming similar relief.
2. Plaintiff has contested both these I.As by filing separate replies.
3. Copies of petition of said O.A. and written statements filed by defendant No. 1, plaintiff and its three partners are placed on the file. In said O.A. plaintiff
has been imp leaded as respondent No. 1 while its three partners as respondents 2 to 4. Defendant No. 1 has been imp leaded as respondent No. 5 while defendant No. 3 as respondent No. 6. It is alleged in the O.A. that respondent No. 1 through its partners respondents 2 to 4 was sanctioned BE/LC limit up to Rs. 10 lakhs vide letter dated 19th March 1993 by the petitioner. Respondent No. 6 deals
in electronic goods and used to purchase the same from respondent No. 1, a manufacturer. On several occasions, respondent No. 6 opened letters of credit with its bankers respondent No. 5 in favor of respondent No. 1 for clearance
of various bills. Several times the petitioner bank discounted the bills, made payments against LCs and received payments from respondent No. 5 on negotiating the documents. During the course of business the respondent No. 6 opened following irrevocable letters of credit:-
1. EK/Adv/LC/23/20 dated 14.08.93 BE No. 64/93
2. EK/Adv/LC/23/30 dated 01.10.93 BE No. 69/93
3. EK/Adv/LC/23/35 dated 16.10.93 BE No. 70/93
4. EK/Adv/LC/23/32 dated 09.10.93 BE No. 71/93
5. EK/Adv/LC/23/37 dated 26.10.93 BE No. 76/93
6. EK/Adv/LC/23/36 dated 29.10.93 BE No. 77/93
In respect of said BE/LCs the bills of exchange (hundies) were executed by respondent No. 6 which were duly discounted by petitioner bank. It is further alleged that the documents relating to said BE/LCs were presented to respondent No. 5 for negotiations. However, respondent No. 5 pointed out certain discrepancies therein. Despite rectification of those discrepancies by respondent No. 1, the respondent No. 5 bank failed to make payment thereof. It is further alleged that by the letter dated 12th January 1994, the respondent No. 5 for the first time informed the petitioner bank about its not having received the documents relating to BE Nos. 47/93 and 64/93. Vide letter dated 30th January 1994 the petitioner bank informed respondent No. 5 that the documents pertaining to both the said BEs were sent by registered post No. 1162 dated 12th September 1993 and those were acknowledged by respondent No. 5 as was shown in the certificate of, delivery issued by the Postal department. Though respondent No. 5 wrote a letter dated 21st January 1994 to the petitioner bank but it again failed to acknowledge the receipt documents pertaining to said BEs 64/93 and 47/93. So, a protest was lodged by the petitioner vide letter dated 2nd February 1994 with the respondent No. 5 but nothing material came out. It is further alleged that on final accounting a total sum of Rs. 11,78,593.10p including interest up to 7th October 1996 was due which is payable jointly and severally by respondents 1 to 6. Details of said amount have been given as under:-
1. BE 64/93 Rs. 2,10,513.00
2. BE 69/93 Rs. 2,02,975.00
3. BE 70/93 Rs. 2,00,114.00
4. BE 71/93 Rs. 1,33,111.00
5. BE 76/93 Rs. 2,34,123.00
6. BE 77/93 Rs. 1,92,299.10
5. It is alleged that besides BE/LC limit the
respondents 1 to 4 also enjoyed temperary overdrawing in
their Current Account No. 2873 with the petitioner bank.
Respondents 1 to 4 failed to clear the outstanding amount
of Rs. 3858.63 including interest up to 7th October 1996 in
that account. It was prayed that a decree for
Rs. 11,78,593.10p with interest be passed against
respondents 1 to 6 jointly and severally. Decree of
Rs. 3,858.63 was also sought to be passed with interest
against respondents 1 to 4 jointly and severally.
6. To be only noticed that respondent No. 5 bank as also respondents 1 to 4 in their separate written statements have denied the liability for payment of the amount claimed by the petitioner bank.
7. As noticed above, in present suit decree for Rs. 15,14,112/- with interest has been claimed against defendants 1 and 3 to 6 Jointly and severally. In the alternative, decrees of Rs. 12 ,07,547/- against defendant No. 1, of Rs. 3,06,575/- against defendant No. 2 and of Rs. 15,14,122/- against defendants 3 to 6 jointly and severally with interest have been sought by the plaintiff. A bare perusal of plaint would indicate that BEs referred to in aforesaid OA have been made the basis for passing decree against the defendants and, thus, the matter in issue in this suit is directly and substantially in issue in previously instituted O.A. 874/95. Indisputably, in both the cases parties are the same. While opposing stay of suit the submission advanced by Ms. Sumati Anand for plaintiff was that in said O.A. 874/95 the plaintiff who is imp leaded as respondent No. 1, cannot raise counter claim for the suit amount either against defendant No. 1 and/or defendant No. 3 who are respondents 5 and 6. In my view, non-availability of the right to raise counter claim against the said defendants has no relevance whatsoever as regards stay of suit under Sections 10 and/or 151 CPC. Though, provision of Section 10 may not apply in the case, the DRT not being a "court" and O.A. 874/95 not being the suit, but for the foregoing discussion, the suit deserves to be stayed in exercise of inherent power under Section 151 CPC.
8. Consequently, both the I.As are allowed and suit is stayed till the decision of aforesaid O.A. No. 874/95.
