Karnataka High Court

Sharad V Sampat S/O Vallabhadas ... vs Managing Director And Anr on 16 January, 2023

Bench: C.M. Poonacha

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       IN THE HIGH COURT OF KARNATAKA
              KALABURAGI BENCH

   DATED THIS THE 16TH DAY OF JANUARY, 2023

                     BEFORE

     THE HON'BLE MR.JUSTICE C.M.POONACHA

           RSA No.200120/2015 (DEC)

BETWEEN

1. SHARAD V SAMPAT S/O VALLABHADAS SAMPAT
DEAD BY LRS.,

1A) PARGANESH S. SAMPATH S/O LATE S.V.SAMPATH
AGE: 60 YEARS, OCC: BUSINESS
R/O H.NO.L-146, NIJALINGAPPA COLONY, RAICHUR

1B) RAKESH S. SAMPATH S/O LATE S.V.SAMPAT
AGE: 45 YEARS, OCC: BUSINESS
R/O H.NO.L-146, NIJALINGAPPA COLONY, RAICHUR

2. SMT.ANUSUYA W/O SHARAD V. SAMPAT
AGE: 74 YEARS, OCC: HOUSEHOLD
R/O H.NO.L-146, NIJALINGPPA NAGAR, RAICHUR

3. RAJANIKANT TOPRANI S/O PARAMANAND TOPRANI
DEAD BY LRS.,

3A) SRI KRISHNARAJ S/O LATE RAJINIKANT TOPRANI
AGE: 57 YEARS, OCC: BUSINESS
R/O H.NO.12 MAHALAXMI TEMPLE STREET
BHULBHAI DESAI, BOMBAY
                                      ...APPELLANTS

(BY SRI SHIVAKUMAR KALLOOR, ADVOCATE)
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AND

1. MANAGING DIRECTOR
KARNATAKA STATE FINANCIAL CORPORATION
HAVING ITS PRINCIPAL OFFICE AT NO.25
MAHATMA GANDHI ROAD, BANGALORE

2. THE BRANCH MANAGER
KARNATAKA STATE FINANCIAL CORPORATION
STATION ROAD, RAICHUR
                                  ...RESPONDENTS

(BY SRI VEERANAGOUDA MALIPATIL, ADVOCATE)

    THIS RSA FILED U/S 100 OF CPC, AGAINST THE
JUDGEMENT AND DECREE DATED 28.01.2015 PASSED IN
R.A.NO. 28/2011 ON THE FILE OF THE PRINCIPAL SENIOR
CIVIL JUDGE AND C.J.M. AT RAICHUR, DISMISSING THE
APPEAL AND CONFIRMING THE JUDGMENT AND DECREE
DATED 22.09.2011 PASSED IN O.S. NO. 127/1989 ON THE
FILE OF THE ADDL. CIVIL JUDGE JR. DN. AND JMFC-III AT
RAICHUR.

     THIS APPEAL COMING ON FOR ADMISSION THIS
DAY, THE COURT DELIVERED THE FOLLOWING:

                     JUDGMENT

Heard the learned counsel for the appellants and

the learned counsel for the respondents.

2. The appellants, who are the plaintiffs

before the Court below have filed the present appeal

challenging the judgment and decree dated

28.01.2015 passed by the Principal Senior Civil Judge

and CJM at Raichur in R.A.No.28/2011 confirming the

judgment and decree dated 22.09.2011 passed by the

Additional Civil Judge (Jr.Dn.) and JMFC-III at Raichur

in O.S.No.127/1989 filed by the appellants/plaintiffs.

3. The parties are referred to as per their rank

before the Trial Court for convenience.

4. It is the case of the plaintiffs that they are

the Directors of one M/s.Dhanalaxmi Industries and

for the purpose of building purchase machineries, etc.,

have applied for a loan from the defendants -

Corporation. The plaintiffs were sanctioned loan of

Rs.10.18 lakhs subject to the terms and conditions

vide letters dated 17.11.1979 and 03.12.1979. The

plaintiffs have also availed additional loan of Rs.5.56

lakhs on 07.03.1984 and executed deed of guarantee

on 31.03.1984. It is forthcoming from the records

that the loan amount availed from the defendants -

Corporation not having been repaid, recovery

proceedings were initiated. The plaintiffs have filed a

suit in O.S.No.127/1989 inter-alia contending that

some of the share holders of the company have

colluded with the defendants - Corporation and

availed the funds of the company and utilized the

same. Hence, they sought for declaration that the

plaintiffs are discharged from the guarantee deed

dated 31.03.1984 and also called in question the

subsequent sale proceedings as per the agreement of

sale dated 21.10.1992 executed by the defendants -

Corporation.

5. It is also forthcoming from the records that

the plaintiffs filed W.P.No.29618 to 29620/1995 and

other connected matters during the pendency of the

suit, calling in question the action taken for sale of the

property by the defendants - Corporation. A

Coordinate Bench of this Court, vide order dated

05.09.2000 has dismissed the writ petitions. While

dismissing the writ petitions, this Court noticed that

the plaintiffs have filed O.S.No.127/1989 and also the

issues framed by the Trial Court and held that it would

be open to the plaintiffs to pursue their remedies in

the said suit.

6. It is also forthcoming from the records that

the defendants - Corporation initiated proceedings

under Section 31 (1) (aa) of the State Financial

Corporation Act, 1951 (for short 'SFC Act') in Civil

Misc.No.30/1993 with regard to the guarantee deed

executed by the plaintiffs. The plaintiffs have entered

appearance in Civil Misc.No.30/1993 and contested

the said proceedings. The Court of the Principal

District Judge at Raichur vide order dated 26.07.2008

allowed the petition filed under Section 31 (1) (aa) of

SFC Act filed by the defendants - Corporation and

ordered that Corporation is entitled to enforce the

liability of sureties/guarantors jointly and severally to

recover a sum of Rs.33,04,599.29/- together with

interest. The said order dated 26.07.2008 passed in

Civil Misc.No.30/1993 was challenged before this

Court in MFA No.30091/2008 connected with MFA

No.30173/2008 (SFC). A Division Bench of this Court

vide its judgment dated 27.09.2010, dismissed the

said appeals.

7. The Trial Court vide its judgment dated

22.09.2011 dismissed the suit in O.S.No.127/1989.

Being aggrieved, the plaintiffs have preferred

R.A.No.28/2011 before the Court of the Principal

Senior Civil Judge and CJM at Raichur. The first

appellate Court vide its judgment dated 28.01.2015,

dismissed the said appeal. Being aggrieved, the

present second appeal is filed.

8. The learned counsel for the appellants

vehemently contends that the Courts below erred in

not considering the suit of the plaintiffs on its merit

and erred in dismissing the suit by holding that the

same is barred by principles of res-judicata.

9. Per contra, learned counsel for the

respondents submits that both the Trial Court and the

first appellate Court have rightly dismissed the suit

filed by the plaintiffs considering the orders passed in

the proceedings initiated by the defendants -

Corporation under Section 31 (1) (aa) of the SFC Act.

10. I have considered the submissions made by

both the learned counsel and perused the material on

record.

11. It is forthcoming from the records that

after the plaintiffs filed a suit, which was initially

numbered as O.S.No.48/1986 and subsequently

renumbered as O.S.No.127/1989 due to amendment

of enhanced pecuniary jurisdiction and the suit has

been transferred to the Court of the Additional Civil

Judge (Jr.Dn.) and JMFC-III at Raichur, the plaintiffs

instituted W.P.Nos.29618 to 29620/1995 and other

connected matters, which were dismissed by this

Court vide order dated 05.09.2000.

12. Subsequent to institution of the suit as

noticed above, the defendants - Corporation initiated

the proceedings in Civil Misc.No.30/1993 under

Section 31 (1) (aa) of the SFC Act. Under Section 31

of the SFC Act, the defendants - Corporation is

entitled to initiate proceedings inter-alia for enforcing

the liability of any surety. The Principal District Judge

at Raichur while considering Civil Misc.No.30/1993,

framed the following question for consideration:

"Whether the petitioner is entitled to enforce the liability of the respondents/sureties for the amount claimed in the petition as required under Section 31 (1) (aa) of the SFC Act, 1951?"

13. The Principal District Judge at Raichur vide

its order dated 26.07.2008 has allowed the petition

filed by the defendants - Corporation, which order has

been upheld by the Division Bench of this Court vide

judgment dated 27.09.2010 passed in MFA

No.30091/2008 connected with MFA No.30173/2008

(SFC). The Trial Court considering the proceedings

initiated by the defendants - Corporation, had

specifically framed an additional issue No.1 i.e.,

"Whether suit of the plaintiffs is barred by principles of

res-judicata?".

14. The Trial Court considering the order

passed in Civil Misc.No.30/1993 and considering

Section 11 of CPC, has recorded a categorical finding

on fact that the issue for consideration in the suit is

directly and substantially, an issue that was

considered in Civil Misc.No.30/1993. The Trial Court

has also noticed the finding recorded vide order dated

05.09.2000 while dismissing the writ petition that the

plaintiffs have suppressed the material facts and made

deliberate false and mischievous statements before

the Court and that they were aware of the said sale

and handing over of the assets to the purchaser and

in spite of that they have kept quite for nearly 3

years.

15. The first appellate Court vide its judgment

dated 28.01.2015, noticing the issues as well as

additional issues framed by the Trial Court, has

framed the following points for consideration:

1. Whether the Court below is justified in dismissing the suit as barred by principles of res-judicata without there being any pleadings and evidence on record?