Gujarat High Court
A J Choksi vs Gujarat Industrial Investment ... on 7 February, 2024
Author: Sunita Agarwal
Bench: Sunita Agarwal
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C/FA/5013/2023 ORDER DATED: 07/02/2024
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 5013 of 2023
With
CIVIL APPLICATION (FOR STAY) NO. 1 of 2022
In R/FIRST APPEAL NO. 5013 of 2023
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A J CHOKSI
Versus
GUJARAT INDUSTRIAL INVESTMENT CORPORATION LIMITED
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Appearance:
MR KUNAL P VAISHNAV(5111) for the Appellant(s) No. 1,2,3,4
MR MIT S THAKKAR FOR MS MEGHA JANI(1028) for Defendant No. 1
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CORAM:HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE SUNITA AGARWAL
and
HONOURABLE MR. JUSTICE ANIRUDDHA P. MAYEE
Date : 07/02/2024
ORAL ORDER
(PER : HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE SUNITA AGARWAL)
1. The instant appeal has been filed by four
persons who were defendants in the suit for
recovery namely Commercial Civil Suit No.86 of 2016
filed by Gujarat Industrial Investment Corporation
Limited, in the matter of recovery of an
outstanding towards loan extended by it. The
appellants herein/defendants in the suit are
guarantors and promoters of M/s.Choksi Circuits
Private Limited, the borrower company duly
incorporated under the provisions of the Companies
Act, 1956. The suit has been decreed partly for
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recovery of a sum of Rs.1,45,14,776/- from
defendant Nos.2 to 5, namely appellant Nos.1 to 4
herein jointly and severally with the interest
thereon at the rate of 9% per annum from the date
of institution of the suit till realization.
2. Challenging this decree, it is sought to be
submitted by the learned counsel for the appellants
that the father of the appellants namely Mr.J.N.
Choksi who was defendant No.1 in the suit was
looking after the matter and the appellants were
not aware of the proceedings after his death. This
statement made by the learned advocate for the
appellants is found to be incorrect from the facts
noted in the order impugned that the defendant
Nos.2 to 5 had been given sufficient opportunity to
contest the matter after they had put in appearance
through an advocate namely Mr.D.S.Sharma, but later
since 01.07.2017, except on one date i.e.
06.01.2017 till the date of the decision, neither
the learned advocate for the defendants nor the
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defendants had turned up. No evidence has been led
by the defendants in the suit proceedings. The
Commercial Court has decided the matter on perusal
of the documentary evidence led by the plaintiff.
Four issues were framed which are to be noted as
under :-
"(1)Whether the plaintiff is entitled to the
reliefs as sought for against the defendants?
(2) Whether this Court has jurisdiction to
try the suit?
(3) Whether the suit is filed within the
period of limitation?
(4) What order and decree?"
3. On Issue No.1 with regard to the entitlement
of the plaintiff to seek the relief of recovery, it
is noted by the Trial Court that the defendant
Nos.1 to 5 (defendant Nos.2 to 5 before us) are the
guarantors and promoters of M/s.Choksi Circuits
Private Limited and the said company had applied
for financial assistance which was extended by the
plaintiff by way of a term loan for their proposed
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project at Gandhinagar. The term loan was
sanctioned on 02.04.1988 to the tune of
Rs.57,00,000/-, a copy of the sanction letter was
brought on record as Exhibit-50. On further demand
of the aforesaid company additional financial
assistance for Rs.15,00,000/- was sanctioned vide
letter dated 22.03.1991, copy of which was
exhibited as Exhibit-53. The defendants who became
guarantors of the said company had executed a Deed
of Joint and Several Guarantee on 10.08.1988 for
term loan of Rs.57,00,000/- and another Deed of
Joint and Several Guarantee dated 25.04.1991 was
executed by the defendants for the additional
financial assistance of Rs.15,00,000/-, in favour
of the plaintiff Corporation. They are, thus,
liable to repay the aforesaid amount together with
interest, cost, charges and expenses.
4. Taking note of the fact that the liability of
the guarantors is coextensive with the principal
debtor as per Section 128 of the Contract Act, 1872
and having gone through the documentary evidence
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brought on record by the plaintiff, while answering
Issue No.1 in favour of the plaintiff, it was
concluded by the Commercial Court that the case of
the plaintiff rests on the documentary evidence
such as sanction letters, Deeds of Joint and
Several Guarantees which have been executed by the
defendants who had not come forward to dispute or
deny the said documents despite sufficient
opportunity given during the proceedings. It was,
thus, concluded that the plaintiff has proved its
case. The other issues pertaining to the
jurisdiction and the limitation in filing the civil
suit have accordingly been decided with the
discussions on Issue Nos.2 and 3 in the judgment
impugned.
5. We may note that the learned counsel for the
appellants could not make any submissions to assail
the merits of the judgment and order dated
18.12.2017 passed by the Commercial Court. Though
the delay of 864 days in filing the instant appeal
has been condoned by this Court on payment of cost,
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but having entered into the merits of the case, we
do not find any good ground to accept the
submission of the learned counsel for the
appellants that the appellants/defendant Nos.2 to 5
could not appear in the suit proceedings despite
due diligence. At the cost of reiteration, it is
noted that nothing substantial could be submitted
on the merits of the case of the plaintiff which
has been accepted in the decree passed by the
Commercial Court.
6. For the aforesaid, the appeal is found devoid
of merits and hence, dismissed. Consequently, the
connected Civil Application also stands disposed
of.
(SUNITA AGARWAL, CJ )
(ANIRUDDHA P. MAYEE, J)
GAURAV J THAKER
