V.K. Tours & Transport vs M/S. Mafatlal Finance Co. Ltd.
2010 Latest Caselaw 1277 Del

*            IN THE HIGH COURT OF DELHI AT NEW DELHI

+                            C.R.P. 190/2008

                                           Date of decision : 08.03.2010
IN THE MATTER OF :

V.K. TOURS & TRANSPORT                     ..... Petitioner
                  Through: Mr. Arshdeep Singh, Advocate


                        versus


M/S. MAFATLAL FINANCE CO. LTD.                     ..... Respondent
                   Through: None.

  CORAM
* HON'BLE MS.JUSTICE HIMA KOHLI

     1. Whether Reporters of Local papers may      Yes
        be allowed to see the Judgment?

     2. To be referred to the Reporter or not?     Yes

     3. Whether the judgment should be             Yes
        reported in the Digest?


HIMA KOHLI, J. (ORAL)

1. The present petition is directed against an order dated 18 th

September, 2008 passed by the learned ADJ in Ex. Petition No.

85/1999 filed by the respondent/DH for execution of the judgment and

decree dated 13th May, 1999 for Rs.1,84,760/- with interest @ 18%

per annum and costs in Suit No. 441/1998 entitled Mafatlal Finance

Company Ltd. vs. V.K. Tours and Transport and Another.

2. In a nutshell, the facts of the case are that the respondent

instituted a suit against the petitioner for recovery of Rs.1,84,760/-

alongwith interest @ 24% per annum and costs, on account of

recovery of amounts due to the respondent/DH against a lease

agreement dated 26th February, 1997 executed by the petitioner, in

respect of a Maruti Esteem car bearing no. DL 6CB 6066. The

petitioner did not appear in the aforesaid proceedings and was directed

to be proceeded against ex-parte, whereafter an ex-parte judgment

and decree came to be passed on 13th May, 1999.

3. The respondent/DH filed an execution petition bearing Ex.

Petition No. 85/1999 before the learned ADJ, seeking execution of the

aforesaid judgment and decree. On 22nd December, 1999, the

petitioner filed an application under Order IX Rule 13 read with Section

151 of the CPC in the suit proceeding, praying inter alia for setting

aside the ex parte judgment and decree dated 13th May, 1999. The

records reflect that the said application was ultimately dismissed by

the Civil Judge vide order dated 9th August, 2005. However,

contemporaneously, the petitioner also filed an application before the

Execution Court under Order XXI Rule 26 of the CPC seeking stay of

the execution proceedings. Vide order dated 23rd December, 1999,

notice was issued on the aforesaid application to the decree holder and

the execution proceedings were stayed subject to the petitioner

submitting a bank guarantee for Rs.1,52,000/- in Court.

4. On 27th January, 2000, in compliance of the aforesaid

orders, the petitioner furnished a bank guarantee to the Court,

through Canara Bank for the sum of Rs.1,52,000/- which was valid for

a period of one year i.e. till 27th January, 2001. As the respondent/DH

failed to appear in the execution proceedings, vide order dated

16.2.2001, the learned ADJ dismissed the Execution Petition No.

85/1999 and the file of the case was directed to be consigned to the

Record Room. However, the original Bank Guarantee dated 27 th

January, 2000 for a sum of Rs. 1,52,000/- was not discharged.

5. Instead of filing an application for restoration of the first

execution petition, the respondent/DH filed a second execution petition

seeking execution of the same judgment and decree dated 13 th May,

1999, registered as Ex. Petition No. 419/2006. A certified copy of the

aforesaid execution petition is handed over by the counsel for the

petitioner in the course of arguments and is taken on record.

6. During the pendency of the second execution petition, the

petitioner arrived at a settlement with the respondent and issued a

cheque for Rs.1,52,000/- to it on 6th July, 2007. The statement of the

officer appearing on behalf of the respondent/Decree Holder was duly

recorded by the Executing Court on 6.7.2004. In the statement, the

said officer deposed that he had received from the

petitioner/Judgment Debtor a cheque dated 3rd July 2007, for a sum of

Rs.1,52,000/- in full and final settlement of the dues of the judgment

debtor and that after receiving the said amount nothing was payable

by the judgment debtor and the execution petition stood satisfied.

Accordingly, leave was sought to withdraw the execution petition as

satisfied. In view of the statement made by the authorized officer of

the decree holder, on the same date, the execution petition was

disposed of as satisfied and the file was consigned to the Record

Room.

7. Thereafter, as the matter was settled between the parties,

the petitioner herein filed an application under Section 151 of the CPC

in Ex. Petition No. 85/1999 seeking cancellation of the endorsement on

the bank guarantee dated 27th January, 2000 and for release of the

same. Along with the application, the petitioner also enclosed a copy

of the statement of the Officer of the decree holder as recorded in the

Ex. Petition No.419/2006 on 6.7.2007 and the order of even date

passed by the Execution Court disposing of the execution petition.

However, the aforesaid application was dismissed by the impugned

order by observing that there was no material on the record to show

that the decree holder and the judgment debtor had compromised or

settled the matter in respect of Ex. Petition No. 85/1999.

Consequently, the prayer for cancellation of the endorsement on the

bank guarantee was declined.

8. Counsel for the petitioner submits that though there was no

specific averment made in the application filed before the Execution

Court that the matter had been settled between the parties, fact of the

matter was that the application was duly supported with the relevant

documents, particularly the statement of the officer of the decree

holder and the order dated 6th July, 2007 disposing of Execution

Petition No.419/2007 and hence the conclusion arrived at by the Court

below was erroneous and contrary to the material placed on the

record.

9. A comparison of the first execution petition filed by the

respondent, registered as Ex. Petition No. 85/1999 and the second

petition registered as Ex. Petition No. 419/2006 shows that the names

of the parties as well as the date of the judgment and decree is

identical. In fact, in column no.6 of the second execution petition, it

was specifically mentioned that an earlier execution petition was filed

by the respondent seeking execution of the judgment and order dated

13th May, 1999. It is also pertinent to note that the sum of

Rs.1,52,000/- mentioned in the bank guarantee and offered by the

petitioner in Execution Petition No.85/1999, was the exact amount

which was finally paid by the petitioner to the respondent in Ex.

Petition No.419/2006 towards full and final settlement of the judgment

and decree dated 13th May 1999. Hence there is no manner of doubt

that the subject matter of Ex. Petition No. 85/1999 was identical to Ex.

Petition No. 419/2006. As Ex. Petition No. 419/2006 was disposed of

as satisfied in terms of order dated 6th July, 2007, there was no

impediment in allowing the application filed by the petitioner in

Execution Petition No.85/1999, seeking cancellation of the bank

guarantee and its release in favour of the petitioner.

10. The Court below ought to have taken into consideration the

fact that the bank guarantee furnished in Execution Petition

No.85/1999 was not required any more in the light of the settlement

arrived at between the petitioner and the respondent in Execution

Petition No.419/2006. As the cause of action in Execution Petition

No.85/1999 did not survive, there was no reason for the bank

guarantee not to be discharged and released, the same having been

rendered infructuous.

11. Accordingly, the present petition is allowed. The impugned

order dated 18th September, 2008 is set aside. The Execution Court is

directed to cancel the endorsement made on the bank guarantee of

Rs.1,52,000/- offered by the petitioner, and release the same in its

favour, subject to the condition that the petitioner shall place on the

record of the Execution Court, a certificate issued by HDFC Bank, that

cheque bearing No. 174151 dated 3rd July, 2007 issued by the

petitioner in favour of the respondent for a sum of Rs.1,52,000/- in

satisfaction of Ex. Petition No.419/2006, was duly encashed.

12. The petition is disposed of.

(HIMA KOHLI) JUDGE March 08, 2010 sindhu