Delhi High Court
Ess Aar Universal (P) Ltd. & Ors. vs Shri Girish Mehra on 10 July, 2012
Author: Pradeep Nandrajog
$~R-33
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Decision: July 10, 2012
+ RFA(OS) 116/2010
ESS AAR UNIVERSAL (P) LTD. & ORS. ..... Appellants
Represented by:Mr.D.K.Rustagi with
Mr.B.S.Bagga and Mr.Arpit
Bhargava, Advocates
versus
SHRI GIRISH MEHRA ..... Respondent
Represented by: None
CORAM:
HON'BLE MR. JUSTICE PRADEEP NANDRAJOG
HON'BLE MR. JUSTICE MANMOHAN SINGH
PRADEEP NANDRAJOG, J. (Oral)
1. Suit filed by the appellant against the respondent, Girish
Mehra, has been held to be barred by limitation as also under
Order II Rule 2 CPC as well as on constructive res judicata.
2. Undisputed facts are that the appellants had a commercial
transaction with a company M/s.Mehra Air Products Pvt. Ltd. and
in respect of which, Prem Mehra, Satish Mehra, Harish Mehra and
the respondent Girish Mehra had executed a joint guarantee
undertaking to re-pay the amount outstanding and payable by
M/s.Mehra Air Products Pvt. Ltd. to the appellant.
3. There being defaults, undisputably, the appellant invoked
the guarantee in question; but for unexplainable reasons filed a
suit only against M/s.Mehra Air Products Pvt. Ltd., Prem Mehra,
Harish Mehra and Satish Mehra. The said suit registered as
CS(OS) No.1319/1997 was decreed on September 03, 2002.
Thereafter CS(OS)No.1240/2007 was filed by the appellant against
the fourth guarantor i.e. Girish Mehra, who raised the question,
while seeking leave to defend, of the suit being barred by
limitation as also Order II Rule 2 CPC and on the doctrine of
constructive res judicata; all pleas which have found favour with
the learned Single Judge.
4. It is settled law that the liability of a guarantor would cease
if the principal debt payable by the principal debtor is barred by
limitation i.e. cannot be recovered. This position of law is
conceded to by learned counsel for the appellants.
5. But, it is urged that the guarantee being a continuing
guarantee and that the appellant has already obtained a decree
against a principal debtor, would require it to be treated that the
liability of the principal debtor continues and thus the liability of
the guarantor also continues.
6. The argument is rejected by us for the reason, with respect
to the facts of the instant case what needs to be considered is:
Whether the appellants could sue the principal debtor when the
instant suit was filed, if the previous suit had not been filed? The
reason to draw this distinction is that, if what the appellant alleges
to be the correct legal position is accepted, then it would mean
that a suit can be filed within the limitation prescribed against a
principal debtor and decree obtained and as long as the decree
remained unexecuted, over an indefinite period of time, another
suit can be filed against the guarantor by relying upon the
guarantee.
7. Suffice would it be to state that the debt in favour of the
appellant was enforced by the appellant against the principal
debtor and three guarantors in the year 1997. After 10 years, the
instant suit was filed against the fourth guarantor.
8. We concur with the view taken by the learned Single Judge
that the suit was barred by limitation.
9. We need not deal with the two other issues pertaining to the
application of Order II Rule 2 CPC and the doctrine of constructive
res judicata.
10. The appeal is dismissed but without any order as to costs,
since none appears for the respondent.
(PRADEEP NANDRAJOG)
JUDGE
(MANMOHAN SINGH)
JUDGE
JULY 10, 2012
rk
