Unico Leasing Ltd & Ors. vs Uco Bank
2011 Latest Caselaw 1656 Del

04

*              THE HIGH COURT OF DELHI AT NEW DELHI

%                                     Judgment delivered on: 23.03.2011


               WP(C) 1526/2011 & CM No. 3246/2011 (Condonation of delay)


UNICO LEASING LTD & ORS.                                             ..... PETITIONERS


                                         -versus-


UCO BANK                                                             ..... RESPONDENT

Advocates who appeared in this case:

For the Petitioners:          Mr Arvind Sharma, Adv.
                              Petitioner No.2(c) in person.
For the Respondent:           Mr D S Chauhan, Adv.


CORAM :-
HON'BLE MR JUSTICE SANJAY KISHAN KAUL
HON'BLE MR JUSTICE RAJIV SHAKDHER
1.   Whether the Reporters of local papers may
     be allowed to see the judgment ?
2.   To be referred to Reporters or not ?
3.   Whether the judgment should be reported
      in the Digest ?

SANJAY KISHAN KAUL, J (ORAL)

1. The respondent-bank granted loan facility to petitioner no.1. Late Sh R L Jain

(represented through LRs (a), (b) and (c) as petitioner no.2), petitioner no.3 and

petitioner no.4 are stated to be erstwhile directors of petitioner no.1 who stood guarantee

for the loan. The loan was in the form of a cash credit limit of Rs 70 lacs granted in

August, 1989. The limit was enjoyed by petitioner no.1 but the amount was not being

paid. The debt was acknowledged from time to time. On 30.09.1992 the debt was

acknowledged at Rs 1,02,57,164 vide its acknowledgement of debt dated 14.01.1993.

The OA was ultimately filed before the Debt Recovery Tribunal in 1997.

2. In terms of order dated 05.09.1997 summons and notices were directed to be

issued to the respondent in the OA. It was specifically directed "it shall be the duty of

the applicant bank to get the defendants served by registered post and ordinary post. A

copy of this order, OA and documents be also sent alongwith summons and notice."

3. It is not disputed by the petitioners that the summons and notices have been sent

at the recorded address of the parties with the respondent-bank. These summons and

notices were however received back unserved with the noting "left" "house locked for a

long time" "addressessee left without any forwarding address". Thereafter notice by

publication took place and the petitioners were proceeded ex-parte.

4. The petitioners filed an application under Order 9 Rule 7 of the Code of Civil

Procedure, 1908 (in short „CPC‟) for setting aside ex-parte order dated 18.02.1998 and

in the alternative an application under Order 9 Rule 13 of the CPC to set aside the

judgment/decree dated 23.03.1998. This application is dated 28.08.1998. The

petitioners stated in the application that they came to know about the pending

adjudication being listed for 23.09.1998 on 22.09.1998 from the office of the bank, and

thus appeared through counsel before the Tribunal on 23.09.1998. Nothing is stated as

to how and why the petitioners were suddenly informed about the recovery proceedings.

It is further stated that the petitioners were not served with the summons/notices in any

manner. Other than this, nothing material has been set out in the application.

5. The application filed by the petitioners was dismissed by the DRT by an order

dated 06.07.2001 and this order has been confirmed by the DRAT vide order dated

06.08.2010.

6. We have heard learned counsel for the parties at length. On the last date of

hearing itself we had pointed out to learned counsel for the petitioners that in view of the

undisputed acknowledgement as on 30.09.1992 referred to aforesaid, whether the

petitioner was willing to deposit at least that amount in Court. Learned counsel for the

petitioners has obtained instructions and states that the petitioners are not willing and are

not able to deposit any further amount than some miniscule amount already deposited

towards a proposed settlement. This being a sum of Rs 15 lacs deposited in February,

2004. We may note that according to learned counsel for the respondent-bank, that

amount was deposited in respect of another loan account relating to another sister

concern of petitioner no.1; though the petitioners‟ claim that the same was for both the

loan accounts.

7. In our considered view, the only issue which has to be examined is whether any

defect can be found in the procedure for service of notice on the petitioners as the

petitioners claim to have been deprived of their right to defence in those proceedings.

8. We find that it is not disputed that the addresses given are correct. There is no

other recorded address of the petitioners with the respondent-bank. The summons have

been returned back of which the envelopes and the AD Cards are available.

9. In respect of these envelopes and AD cards there is a dual challenge made by

learned counsel for the petitioners. The first is that these envelops had been sent by the

counsel for the respondent-bank and not through the Registry. The second is that the

envelopes could not have enclosed the complete set as was required to be done.

10. We find no merit in the aforesaid plea. The order directing summons to be

issued itself provided that the respondent-bank to take the necessary steps to serve the

petitioners herein at their own responsibility. It is in pursuance thereto that the

registered AD cards and the summons were sent to the petitioners which were received

back with the postal reports as indicated hereinabove. The second grievance also does

not have any merit since the petitioners would have raised an issue about non-receipt of

complete set if the same had been delivered. The fact is that the envelopes had been

returned back undelivered. If the petitioners shut down their business or have changed

their addresses it was their bounden duty to inform the respondent-bank as to the address

at which they could be contacted so that the necessary notices of pleadings would have

been sent at those addresses. This is not done by the petitioners.

11. Since no other address was available with the respondent-bank, the next step was

only to take out service through publication. The publication has been done and

consequently, the petitioners were proceeded ex-parte after service through publication.

We find no fault in this procedure.

12. We may record that there are two concurrent findings of DRT and DRAT below

in respect of the service of the petitioners. This Court does not sit as a court of second

appeal but has a duty to see that there is no illegality or perversity in the order. Since the

facts set out in the impugned order were somewhat unclear we considered it appropriate

to call for the record to cull out the relevant facts for actual determination of the

controversy. We may also notice that in so far as the LRs of late Sh R L Jain are

concerned, they have been sued only to the extent that they are inheritors of the estate of

Late Sh R L Jain. There is no personal liability attached to them.

13. No grounds are made out to interfere in the impugned judgment. The writ

petition is dismissed.

14. The record of DRT-II be sent back.

                                                       SANJAY KISHAN KAUL, J




MARCH 23, 2011                                              RAJIV SHAKDHER, J
mb