Delhi High Court
State Bank Of India vs Khushal Singh Tanwar & Another on 7 December, 2010
Author: Valmiki J. Mehta
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ RFA No. 331/1997
% 7th December, 2010
STATE BANK OF INDIA ...... Appellant
Through: Mr. S.N. Relan,
Advocate.
VERSUS
KHUSHAL SINGH TANWAR & ANOTHER .... Respondents
Through: None.
CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA
1. Whether the Reporters of local papers may be
allowed to see the judgment?
2. To be referred to the Reporter or not?
3. Whether the judgment should be reported in the Digest?
VALMIKI J. MEHTA, J (ORAL)
1. The present appeal under Section 96 of the Code of Civil
Procedure, 1908 (CPC) is filed against the impugned judgment and
decree dated 26.3.1997 whereby the trial court dismissed the suit filed
by the appellant bank for recovery of Rs.2,28,746.77.
2. The respondent no.1 approached the appellant bank for grant of
medium term loan for purchasing a bus. The respondent no.1
executed the necessary security documents being Ex.P-1 to P-5 on
19.5.1983. The defendants thereafter also signed the
acknowledgment of debt forms on different dates which have also
been proved and exhibited being 31.12.1983 (Ex.P-10), 31.12.1984
(Ex.P-11), 20.10.1985 (Ex.P-12) and revival letters dated 6.5.1986 by
the principal borrower and the guarantor respectively (Ex.P-13 and P-
14). The statement of account has been proved in this case as Ex.P-22.
On account of default of the respondent no.1 to maintain financial
discipline and failing to pay the amount on the due date, the amount
became was transferred to the recalled debt account on 22.10.1985.
As from this date, there are two accounts which were being
maintained, the first being the main loan account which contains the
entries in the credit side and the corresponding debit entries in the
recalled debt account. Meaning thereby, there is only one debit entry
for different transactions from 22.10.1985 although there are two
separate accounts but there is no duplication of the debit entries.
There are certain other debit entries in the recalled debt account by
which credit of Rs.30,000/- deposited by the borrower in cash on
23.5.1987 has been shown and debits have been shown towards
Deposit Insurance Credit Guarantee Corporation fees, legal notice fee,
court fee etc. The total of this amount was claimed in the suit.
3. By the impugned judgment and decree the suit has been
dismissed on the ground of limitation and that there is no cause of
action.
4. In the opinion of this court, the trial court has gravely erred in
arriving at both the conclusions. Firstly, merely because two accounts
were being maintained because of administrative reasons cannot
mean that the statement of account cannot be looked into. The
perusal of statement of account shows that there is no duplication of
the debit entries. The statement of account in fact can be said to be a
running account in terms of Article 1 of the Schedule of the Limitation
Act and as per which, the limitation would commence from the end of
the financial year in which the last entry is proved in the account. The
last admitted entry in the account is the deposit of cash of Rs.30,000/-
on 23.5.1987. The suit could therefore be filed up to 31.3.1991 or at
least up to 22.5.1990. The suit has in fact been filed on 5.5.1989 and
therefore was well within limitation. In fact, the learned trial court has
further erred because limitation in the present case would be a period
of 12 years and not three years because there is a mortgage in favour
of the appellant bank and in terms of Article 65 of the Limitation Act,
the suit for enforcing of a mortgage has to be within a period of 12
years. Accordingly, in view of the balance confirmation letters and the
revival letters being Ex. P-10 to P-14 and the statement of account
Ex.P-22 and the fact that there is mortgage in the accounts, the suit
filed is well within limitation.
5. So far as the dismissal of the suit on account of no cause of
action is concerned, the same is also clearly without any basis. Merely
because no legal notice has been served would not mean that the
cause of action does not accrue. The cause of action accrues on the
disbursal of the loan and the failure of the borrower and the guarantor
to pay the same. Some discrepancies in the plaint of stating an
amount of Rs.2,28,746.77 instead of the amount of Rs.2,28,246.77 as
shown in the statement of account cannot mean that there is no cause
of action. Further, an amount due which is shown in the balance
confirmation letter need not be reflected in the statement of account
because statement of account will only contain entries pertaining to
actual debits and credits. A balance confirmation is the amount due on
the particular date which is written on the balance confirmation letter
and on which date no entry need be made in the statement of account.
The learned trial court has therefore erred on this account also.
6. In view of the above, the impugned judgment and decree is set
aside since the plaintiff has proved the loan documents being Ex.P-1 to
Ex.P-5, the sale deeds Ex.P-6 and P-7, memorandum of mortgages as
Ex.P-8 and P-9, acknowledgement and revival letters Ex.P-10 to P-14
and the statement of account Ex.P-22, the suit of the plaintiff for a sum
of Rs.2,28,246.77 is decreed being the figure as mentioned in the
statement of account. The counsel for the appellant states that there
is a typing mistake in the plaint as the amount has been stated as
2,28,746.77 instead of the correct amount of Rs.2,28,246.77. I am not
allowing any costs to the appellant inasmuch as the statement of
account filed shows that amount has already been debited towards
court fee, legal notices and so on.
7. The suit of the plaintiff is therefore decreed for Rs.2,28,246.77
along with pendente lite interest and future interest till realization of
the decretal amount @ 14% per annum simple. Decree sheet be
drawn up accordingly. The decree sheet will be drawn up in terms of
Order 34 CPC whereby six months time will be granted for payment to
the respondents, with liberty to the appellant to apply for the final
decree in case the borrowers fail to pay the due amount. The appeal is
accordingly disposed of as allowed by passing of preliminary decree as
stated above.
CM No. 1681/1997 & CM No.1305/98
No orders are required in these applications as the main petition
itself is disposed of and which be accordingly disposed of.
DECEMBER 07, 2010 VALMIKI J. MEHTA,J
ib
