S.Gulshanjit Singh vs Jaswinder Singh & Ors.
2015 Latest Caselaw 8963 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                    Date of decision: 2nd December, 2015.

+                               RFA No.333/2006

       S.GULSHANJIT SINGH                                      ..... Appellant
                    Through:           Ms. Zubeda Begum, Ms. Sana Ansari
                                       and Ms. Vanessa Singh, Advs. along
                                       with appellant in person.

                                       Versus

    JASWINDER SINGH & ORS.             ..... Respondents

Through: None.

CORAM:

HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW

1. This appeal under Section 96 of the Code of Civil Procedure (CPC),

1908 impugns the judgment and decree dated 27th January, 2006 of the Court

of Shri Babu Lal, Additional District Judge (ADJ) Delhi decreeing the suit

filed by the appellant/plaintiff for recovery of monies from (i) Shri Jaswinder

Singh; (ii) Mrs. Surinder Kaur; (iii) Mrs. Anina Kuku; and, (iv) M/s Sabina

International Hotel against the defendants/respondents no.2&3 Mrs.

Surinder Kaur/Mrs. Anina Kuku only and dismissing the same as far as

against the respondents/defendants no.1&4 i.e. Shri Jaswinder Singh and M/s

Sabina International Hotel.

2. Notice of the appeal was issued. None appeared on behalf

of the respondents/defendants despite service. Accordingly, all the four

respondents/defendants were proceeded ex parte on 6th October, 2006 and

the appeal admitted for hearing. The appellant/plaintiff applied for early

hearing pleading his old age and which application came up before this

Court yesterday when the same was allowed and upon the appellant/plaintiff

expressing inability to argue the appeal yesterday, the appeal posted today

for hearing.

3. None appears for the respondents/defendants today also.

4. The counsel for the appellant/plaintiff has been heard and the Trial

Court Record perused.

5. The appellant/plaintiff claims to have lent a sum of Rs.3,50,000/- to

the respondent/defendant no.4 M/s Sabina International Hotel, a partnership

of the respondent/defendant no.1 Shri Jaswinder Singh and Shri S. Surinder

Jit Singh who was the predecessor-in-interest of the respondents/defendants

no.2&3 namely Mrs. Surinder Kuar and Mrs. Anina Kuku. It is further the

case of the appellant/plaintiff that the said amount was repayable with

interest @ 2% per month. Though no averment to the said effect is

found in the plaint and in the affidavit by way of examination-in-chief of the

appellant/plaintiff but the counsel for the appellant/plaintiff on enquiry stated

that the said amount of Rs.3.5 lacs was advanced by the appellant/plaintiff

by cheques in the name of Shri S. Surinder Jit Singh. However when this

order is being dictated, the counsel for the appellant/plaintiff states that the

said amount was lent in cash. The said Shri S. Surinder Jit Singh is stated to

have issued cheques of the months of August to December, 1996 in the total

sum of Rs.3.5 lacs from his personal account in the name of the

appellant/plaintiff in repayment of the said loan. The said cheques were

dishonoured on presentment for the reason of insufficiency of funds.

However before the appellant/plaintiff could file the suit, the said Shri S.

Surinder Jit Singh died leaving the respondents/defendants no.2&3 Mrs.

Surinder Kaur and Mrs. Anina Kuku as his legal heirs. The

appellant/plaintiff claims that Shri S. Surinder Jit Singh, at the time of taking

the loan, had also executed a letter dated 25th May, 1994 on the letterhead of

the respondent no.4 M/s Sabina International Hotel and addressed to the

appellant/plaintiff with a copy to the respondent/defendant no.1 Jaswinder

Singh with respect to the subject transaction. It is further the case of

appellant/plaintiff that neither of the respondents/defendants repaid the loan

or any paid thereof compelling the appellant/plaintiff to file the suit for

recovery of a sum of Rs.6,02,000/- due towards principal amount lent and

interest thereon till the date of institution thereof with future interest

6. The respondents/defendants were proceeded ex parte before the

learned ADJ also and the appellant/plaintiff led his ex parte evidence.

7. The learned ADJ has by the impugned judgment decreed the suit

against the respondents/defendants no.2&3 Mrs. Surinder Kaur and Mrs.

Anina Kuku being the legal heirs of Shri S. Surinder Jit Singh and dismissed

the same against the partnership firm and against the respondent/defendant

no.1 Shri Jaswinder Singh holding that the appellant/plaintiff had failed to

prove giving of any loan to the partnership firm and the evidence including

documentary led by the appellant/plaintiff showed the appellant/plaintiff to

have lent money to Shri S. Surinder Jit Singh only and thus the

appellant/plaintiff could recover the same from Shri S. Surinder Jit Singh/

his heirs only and not from the respondent/defendant no.1 Jaswinder Singh

and/or the partnership firm. The learned ADJ also held that interest claimed

by the appellant/plaintiff at 2% per month was exorbitant and allowed the

appellant/plaintiff interest @ 9% per annum on the principal amount of

Rs.3.5 lacs from the date of notice till the date of refund.

8. I have at the outset enquired from the counsel for the

appellant/plaintiff whether the appellant/plaintiff has executed the decree

already obtained against the respondents/defendants no.2&3 Mrs. Surinder

Kaur and Mrs. Anina Kuku and as to how much is the balance amount if any

remaining due under the decree.

9. The counsel for the appellant/plaintiff states that the appellant/plaintiff

has not applied for execution. During the course of hearing several reasons

are given therefor. It is stated that the appellant/plaintiff was awaiting the

outcome of the present appeal. At another time, it is stated that since the

appellant/plaintiff had been awarded interest lesser than is entitled to, he

deemed it proper to await the result of this appeal to be able to recover the

entire amount with enhanced interest in one go only.

10. In my opinion, the conduct of the appellant/plaintiff of not taking any

steps for execution of the decree against the respondents/defendants no.2&3

Mrs. Surinder Kaur and Mrs. Anina Kuku against whom he is holding a

decree for the last nearly ten years is itself indicative of the

appellant/plaintiff having filed the suit and pursuing this appeal without any

intent to recover the money from the respondents/defendants no.2&3 Mrs.

Surinder Kaur and Mrs. Anina Kuku and the proceedings being conducted in

collusion with the respondents/defendants no.2&3 Mrs. Surinder Kaur and

Mrs. Anina Kuku and with an intent only to recover the monies from the

respondent/defendant no.1 Shri Jaswinder Singh.

11. The counsel for the appellant/plaintiff has heavily relied on the writing

dated 25th May, 1994 supra proved as Ex. PW1/8 in ex parte evidence of the

appellant/plaintiff and in which Shri S. Surinder Jit Singh has categorically

stated that he had taken the loan for the requirements of the partnership firm

and was returning the same by issuing the cheques on behalf of the firm

only. The counsel for appellant/plaintiff has contended that the

respondents/defendants having not controverted the unequivocal statement in

the ex parte evidence of the appellant/plaintiff, the same ought to have been

accepted by the learned ADJ who erred in inspite thereof decreeing the suit

against the respondents/defendants no.2&3 Mrs. Surinder Kaur and Mrs.

Anina Kuku only and not against the respondents/defendants no.1&4 Shri

Jaswinder Singh and M/s Sabina International Hotel. Reliance in this regard

is placed on the judgment of a Single Judge of the High Court of Punjab &

Haryana in Dalip singh Vs. Jagdev Singh MANU/PH/3662/2011 where in

paras 10 & 11 the language of Sections 18 to 22 of the Indian Partnership

Act, 1932 has also been reproduced. It is argued that from the factum of the

said Shri S. Surinder Jit Singh having been accepted as a partner of the

respondent/defendant no.1 in the partnership firm of the respondent no.4 M/s

Sabina International Hotel by the learned ADJ also and from the factum of

the writing aforesaid, denial of the claim against the respondents/defendants

no.1&4 Shri Jaswinder Singh and M/s Sabina International Hotel is bad.

12. I am unable to disagree with the reasoning given by the learned ADJ.

Merely because a defendant in a suit is proceeded against ex parte does not

relieve the plaintiff from proving his/her/its case before the Court and if the

plaintiff fails to do so, the said claim would be denied. The law does not

entitle the plaintiff to a walkover in the absence of the defendant.

13. In the present case, the appellant/plaintiff in his ex parte evidence was

required to prove (i) having lent the sum of Rs.3.5 lac to the partnership firm

and (ii) the cheques purportedly issued in repayment of loan being on behalf

of partnership firm.

14. The appellant/plaintiff has utterly failed to establish any privity of

contract with the partnership firm. All that the appellant/plaintiff in its ex

parte evidence has been able to prove/establish is, privity with the Shri S.

Surinder Jit Singh. The learned ADJ is absolutely correct in reasoning that

had the loan been given to the firm and was refundable by the firm, the

cheques issued purportedly towards refund of the loan would have been of

the partnership firm and not of Shri S. Surinder Jit Singh personally,

especially when it is not the case that the partnership firm was not having

any bank account. That, coupled with the absence of anything at all to show

that the respondent/defendant no.1 or anyone else in the firm had dealt with

the appellant/plaintiff in the matter of the said loan, makes the reasoning of

the learned ADJ in the impugned judgment a plausible reasoning in

accordance with the preponderance of probability.

15. As far as the judgment of the High Court of Punjab and Haryana relied

upon by the counsel for the appellant/plaintiff is concerned, in the facts of

that case it had been proved that it was the firm which was dealing with the

plaintiff therein and the documents were also signed by the accountant of the

firm. Else, Section 22 of the Partnership Act set out in the said judgment

itself provides that in order to bind a firm, an act or instrument done or

executed by a partner or other person on behalf of the firm shall be executed

in the firm name, or in any other manner showing expressly or impliedly an

intention to bind the firm.

16. Though the writing dated 25th May, 1994 is on the letterhead of the

partnership firm but there is no reason as to why the appellant/plaintiff

should have received cheques in refund of the loan allegedly to the

partnership firm from the personal account of Shri S. Surinder Jit Singh. A

Division Bench of the High Court of Kerala in M. Raja Gopal Vs. K.S.

Imam Ali AIR 1981 Ker. 36 held that the mere fact that a note is drawn on

the letterhead of a firm or a mere description of executant as the petitioner of

the firm will not be sufficient to create liability on other petitioners or on

firm.

17. I am therefore unable to find any error requiring interference in the

judgment of the leaned ADJ in so far as dismissing the suit against the

respondents/defendants no.1&4 Shri Jaswinder Singh and M/s Sabina

International Hotel.

18. The only other contention of the counsel for the appellant/plaintiff is

that the learned ADJ in the face of the written contract whereunder Shri S.

Surinder Jit Singh being the predecessor-in-interest of the

respondents/defendants no.2&3 Mrs. Surinder Kaur and Mrs. Anina Kuku

had agreed to pay interest @ 2% per month has reduced the rate of interest to

9% per annum.

19. The rate at which interest is to be granted is absolutely in the

discretion of the Court and the Court is entitled to while awarding interest

including for pre suit period reduce the rate of interest from that provided in

the contract. The only exception to the said principle is where the statute has

provided for a rate of interest as in the case of Micro, Small and Medium

Enterprises Development Act, 2006 or in the case of banking/financial

institution. The loan in the present case appears to be more of a friendly loan

than a commercial transaction and no error can be found with the discretion

exercised by the learned ADJ qua the rate of interest also. Notice may also

be taken of the fact that over the years the interest rates have been falling

rather than rising.

20. There is thus no merit in the appeal.

Dismissed.

No costs.

Decree sheet be drawn up.

RAJIV SAHAI ENDLAW, J.

DECEMBER 02, 2015 'pp'..

(corrected & released on 24th December, 2015)